Euro Falls After Draghi Comments as Yen Rallies on Weak Economy

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The euro fell versus most of its 31 major peers as European Central Bank President Mario Draghi said stimulus to lift the euro areas œabysmal performance may include buying government bonds.

The yen rebounded from its weakest level since 2008 versus the shared currency after Japans economy unexpectedly sank into recession, reviving demand for safer assets. The Swiss franc strengthened to within 0.1 percent of its 1.20-per-euro cap. Brazils real erased gains to trade at a nine-year low while New Zealands dollar rose against its major counterparts as retail sales increased.

The euro fell 0.6 percent to $1.2455 as of 2:56 p.m. in New York.  The yen appreciated 0.4 percent to 145.07 per euro, after earlier touching 146.53.

Japans currency dropped 0.2 percent to 116.47 per dollar, having reached 117.05, the weakest level since October 2007. The yens 14-day relative strength index against both the dollar and euro remains below the 30 level that some traders see as an indicator the currency is poised to strengthen.

Source: Bloomberg

Gold Falls From Two-Week High as Dollar Rallies; Silver Slumps

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Gold futures fell from this months high as the dollars rebound crimped demand for precious metals as alternative investments. Silver dropped the most in a week.

In the week ended Nov. 11, the net-long position in Comex gold futures and options fell 14 percent, government data showed showed on Nov. 14. Holdings tumbled 49 percent over three weeks, the most since December. Assets in exchange-traded products backed by the metal extended a slump to the lowest since May 2009, data compiled by Bloomberg show.

Gold is heading for the second straight annual loss. Today, the dollar approached a five-year high against a basket of 10 major currencies. The Federal Reserve moved closer to its first U.S. interest-rate increase in eight years, while other economies announced more stimulus. European Central Bank Mario Draghi cited an œurgent need to agree on concrete short-term commitments for the euro area.

Gold futures for December delivery fell 0.2 percent to settle at $1,183.50 an ounce at 1:37 p.m. on the Comex in New York. Earlier, the price reached $1,193.60, the highest for a most-active contract since Oct. 31.

Source: Bloomberg

U.S. Stocks Little Changed With S&P 500 at Record Amid Deals

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U.S. stocks were little changed, with the Standard & Poors Index 500 Index at an all-time high, as a slump in small-cap shares and concern over Japans recession offset corporate deals.

The S&P 500 rose 0.1 percent to 2,041.22 at 4 p.m. in New York after earlier losing 0.3 percent. The Dow Jones Industrial Average added 12.69 points, or 0.1 percent, to 17,647.43, six points from an all-time high. The Russell 2000 Index of smaller companies lost 0.8 percent.

Japan unexpectedly sank into a recession last quarter as it struggled to cope with Aprils sales-tax increase. The worlds third-largest economy shrank an annualized 1.6 percent, after a revised slump of 7.3 percent in the previous three months. That missed projections for a 2.2 percent gain in the third quarter.

In the U.S., industrial production dropped last month, weighed down by declines at utilities, mines and automakers that signal manufacturing started the fourth quarter on a soft footing. Separate data showed the Fed Bank of New Yorks Empire Index increased less than forecast in November.

Source: Bloomberg

U.S. Stocks Fluctuate as Japan Recession Offsets Corporate Deals

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U.S. stocks fluctuated, after the Standard & Poors 500 Index climbed to a record last week, as a slump in small-cap shares and concern over Japans recession offset corporate deals.

DreamWorks Animation SKG Inc. slipped 15 percent after Hasbro Inc.s approach to acquire the studio was said to have ended without agreement. Actavis Plc climbed 2.1 percent after reaching a deal to pay about $66 billion for Allergan Inc. Baker Hughes Inc. jumped 10 percent after agreeing to sell itself to Halliburton Co. for $34.6 billion.

The S&P 500 slid 0.1 percent to 2,038.51 at 12:24 p.m. in New York. The Dow Jones Industrial Average rose 1.11 points, or less than 0.1 percent, to 17,635.85. The Russell 2000 Index of smaller companies lost 0.6 percent. Trading in S&P 500 companies was 14 percent below the 30-day average for this time of the day.

Japan unexpectedly sank into a recession last quarter as it struggled to cope with Aprils sales-tax increase. The worlds third-largest economy shrank an annualized 1.6 percent, after a revised slump of 7.3 percent in the previous three months. That missed projections for a 2.2 percent gain in the third quarter.

Source: Bloomberg

European Stocks Rise After Draghi Comments on Government Bonds

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European stocks rose the most in a week, reversing earlier losses, after Mario Draghi said the European Central Banks expanded purchase program could include government bonds.

The Stoxx Europe 600 Index added 0.5 percent to 337.25 at the close of trading in London, after earlier falling as much as 0.8 percent as Japan unexpectedly slipped into a recession. The Stoxx 600 has rebounded 8.8 percent from this years low on Oct. 16 as the Bank of Japan unexpectedly boosted its stimulus and most lenders in Europe passed capital-strength tests.

Earlier, European shares followed Asian stocks lower amid concern over the strength of the global recovery after the report on Japans gross domestic product.

The nations economy, the worlds third largest, shrank an annualized 1.6 percent in the three months through September, following a revised slump of 7.3 percent in the previous quarter. That missed projections for a 2.2 percent gain in the third quarter. The Bank of Japan holds its monetary policy meeting this week. The MSCI Asia Pacific Index dropped 1.4 percent, with Japans Topix index slumping 2.5 percent.

Source: Bloomberg