Euro Claws Back Ground From Dollar

LONDON/NEW YORK, 28 August 2003 — The euro clawed back ground from the dollar in European trading yesterday, as the rapid rise of the US currency ran out of impetus amid a distinct lack of fresh news. The single European currency was trading at $1.0907, against 1.0866 in New York on Tuesday. The dollar traded at 117.77 yen from 117.31 on Tuesday.

Major currencies were sticking to relatively narrow ranges in late London trading, with little in the way of news to generate fresh perspectives, analysts said. The euro had bounced around $1.09 most of the day, while the yen failed to recoup its losses against both the dollar and euro over the past 24 hours.

Analysts said trading was still being thinned by August holidays. Friday’s speech by Federal Reserve Chairman Alan Greenspan on monetary policy should spark some volatility, however.

The euro was changing hands at $1.0907 from 1.0866 late on Tuesday in New York, 128.40 yen (127.46), 0.6925 pounds (0.6922) and 1.5381 Swiss francs (1.5336). The dollar was being quoted at 117.77 yen (117.31) and 1.4100 Swiss francs (1.4108).

The pound was at 1.5748 dollars (1.5691), 185.40 yen (184.07) and 2.2197 Swiss francs (2.2141). On the London Bullion Market, the price of an ounce of gold stood at $364.70 against 360.50 on Tuesday afternoon.

Gold nudged slightly higher in Europe yesterday morning, supported by a slightly stronger euro, which makes dollar-denominated bullion more attractive to holders of the single currency. Bullion backtracked in Asian trading overnight as investors snatched profits from a jump in late New York trading to $366.00 an ounce as the dollar sold off against the euro.

Oil prices fell sharply yesterday as traders took profits following US government data showing record demand had reduced gasoline supplies to the lowest level in three years. New York crude was trading 79 cents lower at $31.16 a barrel, while in London benchmark Brent crude shed 57 cents to $29.20.

Prices are still within $1.50 of five-month highs hit earlier this month as low US gasoline stocks and a slower-than-expected recovery in Iraqi production have added to worries about slender international supplies. After lackluster trading for much of the session, a sell-off gathered momentum following the release of weekly US inventory data that confirmed expectations of a decline in gasoline supplies.

US stocks were near unchanged in very light trade yesterday as investors cautiously waited for news and data over the next week that will give fresh readings on the US economy’s slow recovery. Each of the major indexes is up strongly so far this year, anticipating better company profits, but they have stalled in a narrow trading range for the past few weeks as investors look for further confirmation of an economic recovery.

The blue-chip Dow Jones industrial average was down 15.09 points, or 0.16 percent, at 9,325.36. The broader Standard & Poor’s 500 Index was down 0.76 points, or 0.08 percent, at 995.97. The technology-laced NASDAQ Composite Index was up 3.88 points, or 0.22 percent, at 1,774.53.

Asian stock markets were mostly lower yesterday as investors took profits on a lack of major leads after recent strong gains. The pattern was evident in most of the region’s major markets, but some ended the day higher. The Tokyo Stock Exchange’s Nikkei-225 index ended the day down 23.58 points at 10,308.99. The broader Topix index of all first-section issues sank 0.11 percent or 1.07 points to 1,000.67.

Share prices in Hong Kong closed 0.70 percent lower as the market succumbed to profit-taking amid a lack of fresh leads. The key Hang Seng index lost 75.38 points to close at 10,678.55). Share prices in Singapore eased 0.34 percent on further market consolidation. The Straits Times Index fell 5.50 points to close at 1,594.52, while the broader All-Singapore Equities index declined 0.69 points to 431.5.