LONDON, 9 May 2006 — The dollar recovered yesterday after hitting fresh one-year lows against the euro and sterling on market expectations that the Federal Reserve will soon end its cycle of tightening US interest rates, analysts said.
The euro struck 1.2787 dollars in early European trading, its highest point since May 12, 2005. In late European trade, the euro fell back to 1.2725 dollars from 1.2726 dollars late on Friday in New York.
The dollar fell to 111.48 yen, from 112.46 dollars on Friday. Sterling hit 1.8688 dollars in early trading, its highest level since May 12, before falling back to 1.8588 dollars, unchanged from its level on Friday. The euro was changing hands at 1.2725 dollars against 1.2726 late on Friday, 141.87 yen (143.13), 0.6845 pounds (0.6851) and 1.5617 Swiss francs (1.5610). The dollar stood at 111.48 yen (112.46) and 1.2272 Swiss francs (1.2265).
On the London Bullion Market, the price of an ounce of gold fell to $675.50 per ounce, from $678 late on Friday.
Meanwhile, European stock markets closed mixed yesterday. The CAC 40 index stood at 5,282.40 points, down by 0.08 percent, while in Frankfurt the DAX gained 0.24 percent to finished at 6,127.98, off its earlier high. The London FTSE 100 index fell 0.40 percent to 6,067.10 points.
The DJ Euro Stoxx 50 index of leading euro zone shares won 0.08 percent to 3,877.53 points.
Elsewhere in Europe, in Madrid the Ibex-35 index closed 0.28 percent higher at 12,067.70 points, in Lisbon the PSI-20 gained 0.35 percent to 10,050.51 points, in Amsterdam the AEX rose 0.20 percent to 472.67 points and in Milan the Sp Mib closed up 0.40 percent at 38,552 points.
In Brussels, the Bel 20 fell 0.25 percent to 3,972.21 points. The Swiss SMI gained 0.57 percent to 8,103.6 points.
In New York, the Dow Jones industrial average was up 7.36 points, or 0.06 percent, at 11,585.10. The Standard & Poor’s 500 Index was down 1.31 points, or 0.10 percent, at 1,324.45.
The NASDAQ Composite Index was up 2.01 points, or 0.09 percent, at 2,344.58.
Asian stocks closed sharply higher yesterday. In Tokyo, the Nikkei-225 index climbed 137.90 points to 17,291.67. In Seoul, the KOSPI index closed up 11.21 points at 1,452.23. In Hong Kong, the Hang Seng Index closed up 287.86 points at 17,301.79.
In Sydney, the S and P ASX200 index rose 68.6 points to 5,324.0. In Singapore, the Straits Times index closed 25.36 points up at 2,657.78. In Kuala Lumpur, the composite index closed up 4.52 points at 965.90. In Manila, the composite index put on 118.93 points to 2,589.17. In Bombay, the 30-share Sensex index rose 102.77 points to 12,462.47.
