World stocks, euro climb as US to resume budget talks



Reuters

Published — Friday 28 December 2012

Last update 28 December 2012 12:29 am

| نسخة PDF Print News | A A

LONDON/NEW YORK: World stocks and the euro edged higher yesterday as US lawmakers prepared to resume negotiations to avoid a fiscal crunch, while the yen hit a two-year low on expectations a new government in Tokyo will push for aggressive monetary stimulus.
President Barack Obama will try to revive budget crisis talks, which stalled last week, when he returns to Washington after cutting short his Christmas holiday in Hawaii.
In a sign there may be a way to break the deadlock, Republican House of Representatives Speaker John Boehner urged the Democrat-controlled Senate to act to pull back from the so-called "fiscal cliff" and offered to at least consider any plan the upper chamber produced.
The MSCI global index was up 0.2 percent, while US stocks opened nearly flat. Japan's Nikkei had earlier hit a 21-month high, amid signs the country's authorities are preparing to ease policy considerably.
On Wall Street, the Dow Jones Industrial Average was down 6.01 points, or 0.05 percent, at 13,108.58. The Standard & Poor's 500 Index was down 1.07 points, or 0.08 percent, at 1,418.76. The Nasdaq Composite Index was down 1.55 points, or 0.05 percent, at 2,988.60.
"As we've seen this year, the market really trades on the last headline or the last sound bite that you get in spite of fundamental indicators," said Keith Bliss, senior vice-president at Cuttone & Co. in New York.
"For this week, it's been all about when they are going to have a conversation and what that conversation is going to be like."
European shares were up 0.2 percent as trading resumed after the Christmas holiday break.
Economists warn that the "fiscal cliff" of higher taxes and spending cuts, which are worth $ 600 billion and set to kick in from January, could push the world's largest economy into recession, dragging other countries with it.
The dollar rose to 85.92 yen, its highest since August 2010. It was last up 0.4 percent on the day at 85.91 yen with option barriers cited at 86 yen and stop loss buy orders above 86.10 yen.
Investors accelerated their yen sales after Prime Minister Shinzo Abe said his newly formed government would pursue a bold monetary policy, a flexible fiscal policy and a growth strategy to encourage private investment.

The yen has now fallen roughly 10.5 percent versus the dollar in 2012, its biggest annual drop since 2005. At the same time Japan's benchmark Nikkei is now up 22 percent for the year.
"Yen weakness, based on expectations that the new Japanese government will succeed in driving the dollar to 90 yen with a combination of more aggressive monetary and fiscal policy, is offering support to other currencies," said Marc Chandler, global head of currency strategy at Brown Brothers Harriman in New York.
The euro, meanwhile, rose for a second straight session and traded above $ 1.32 for eight consecutive days partly on position adjustment going into the end of the year and a growing view that euro zone debt tensions have eased.
In commodity markets, London copper rose 1.7 percent to a one-week high of $ 7,945.25 a ton after some positive data from China, the world's top copper buyer whose economy is now a key driver of global growth.
Profits earned by China's industrial companies jumped 22.8 percent in November from a year ago, accelerating from October's 20.5 percent, Beijing reported. "People are hopeful that China's economy will recover next year," said Zhang Ao, an analyst at Minmetals Futures.

What's happening around Saudi Arabia

UN Secretary General Ban Ki-moon and Saudi Arabia’s permanent representative to the UN Abdullah Al- Muallami unveiled a beautifully framed old kiswa (covering) of the door of the Holy Kaaba at one of the newly refurbished halls of the world body. The...
A policeman was shot dead by an unknown gunman in Qatif in the Eastern Province on Tuesday night.According to a spokesman of the Eastern Province police, the firing took place at 11:30 p.m. in a suburb called Al-Jishi.The targeted police officer was...
JEDDAH: Deputy Crown Prince Mohammed bin Salman, second deputy premier and minister of defense, will leave for Egypt today on an official visit.This was announced in a statement released by the Royal Court.During the visit, the deputy crown prince wi...
JEDDAH: Jeddah Show, one of the many events of Jeddah Summer Festival 36, is attracting a large number of visitors. The sound-and-light show is being run at the Jeddah International Exhibition and Convention Center.The show tells the story of the Bri...
JEDDAH: The Riyadh Traffic Department carried out extensive campaigns on the main streets, intersections and squares in the city to boost traffic safety levels and discourage bad driving.During the first 72 hours of the campaign, traffic personnel re...
RIYADH: One of two women infected with the Middle East Respiratory Syndrome coronavirus (MERS-CoV) died here in Riyadh, while the other patient is being treated at a hospital in Al-Kharj, some 60 km from the capital. Since June 2012, the Ministry of...
AL-AHSA: Approximately 20,000 tons of Al-Ahsa dates are planned to be marketed abroad during the new dates season.Muhammad Ismail, director general of the King Abdullah City for Dates (KACD), said: “The authorities in the city are planning to increas...
JEDDAH: Al-Bagdadiya neighborhood residents in Jeddah are living in a state of worry because of 20 abandoned houses, which serve as hideouts for criminals.Residents said some houses are on the verge of collapse and have turned into shelters for crimi...
JEDDAH: A committee consisting of representatives from the Hail governorate, municipality, health department and the Saudi Food and Drugs Administration (SFDA) has ordered the closure of a restaurant in the city’s industrial area.Twelve people suffer...
The board of the Saudia Standards, Metrology and Quality Organization has announced that mandatory application of the regulations on new tires produced or sold in the Kingdom will commence in November this year.The board explained that the technical...
JEDDAH: The number of people with mental health issues or depression is increasing in Saudi Arabia due to urbanization, marital or relationship problems, and not being able to keep up with rapid progress. A Saudi mother said that her daughter suffers...
JUBAIL: Jubail beaches are expected to receive many tourists during September as a large number of people usually head to the city once the summer gets cooler to enjoy their holiday here.As part of the beach preparations for this season, the Social S...
RIYADH: More than 50 percent of vehicle users in the Kingdom are not satisfied with the after-sales service of auto agencies in the Kingdom.In a survey conducted by the Ministry of Commerce and Industry (MCI) to evaluate the performance of automobile...
JEDDAH: The Appeals Court has upheld the verdict issued by a specialized penal court which sentenced Dr. Said bin Zair to four years in prison from the date of his arrest in 1428.According to the ruling, the academician is also banned from traveling...
JEDDAH: Health authorities in the Eastern Province are expected to issue a decision soon against four Saudi nurses accused of “negligence” for an incident which led to the amputation of the hand of a Saudi girl after they tried to insert a needle in...

Stay Connected

Facebook