US markets ended on a slippery note again and US dollar rised against euro

US markets ended on a slippery note again and US dollar rised against euro

Wall Street ended on slippery note on second day too as the prospect of more European bailouts and worries China will rein in inflation prompted investors to abandon risky assets.The developments, especially questions about Ireland's financial stability, caused a spike in the US dollar, which hit commodity prices. That in turn sent equities lower, with natural resources companies leading the way down.Bill Strazzullo, partner and chief investment strategist at Bell Curve Trading in Boston said: "Is dollar strength just a correction in a larger trend of dollar weakness, or are we beginning to turn around here?. If it looks like the U.S. dollar is finally stabilizing here and gaining its footing, we're going to have a good-sized pullback in equities and commodities markets."

The US dollar rose against the euro supported by a rise in US Treasury yields, but later retreated as officials from the Federal Reserve sounded a dovish tone and defended its easing policy.Koji Fukaya, chief currency strategist at Credit Suisse in Tokyo said: "Their comments may have been aimed at tempering the recent rise in

Treasury yields, as well as countering criticism of the quantitative easing policy. It would be problematic if long-term interest rates rise and equities pull back. Whether it was the depth or the speed of the correction,the aim is probably to calm that down a bit."But the euro later recovered some ground, as New York Fed President William Dudley said the need to exit from current policies could be "years away", following up dovish remarks from Fed vice chairwoman Janet Yellen.

The Japanese equities were seen lower as profit-taking set in amid worries over the outlook for corporate profits and the impact of tighter credit in China.Hideyuki Ishiguro, supervisor at Okasan Securities' investment strategy

department said: "Foreign institutions, such as pension funds, have been allocating part of their funds into Japanese stocks to build up their positions from almost nothing."Miners topped the decliners, as key base metals prices fell on fresh concerns that China, one of the world's top commodity consumers, could further tighten monetary policy.European equities FTSE,CAC and DAX retreated as miners were lower, on concerns about Ireland's debt ahead of a key meeting of euro zone finance ministers and renewed talk of further policy tightening in China.Financial shares were on the back foot.

Oil prices ended lower as the dollar rose on euro zone debt concerns and as fears that China's attempts to cool inflation will reduce demand and sparked a broad commodities sell off.Karsten Fritsch, analyst at Commerzbank in Frankfurt said: "The prospect of further monetary tightening in China is worrying for all commodities. So far,Chinese oil demand has been robust, but there are concerns that it could be seriously affected by higher rates, for example."

Dennis Gartman, publisher of the investment newsletter The Gartman Letter said: "There is across-the-board,margin-call type liquidation going on. Investors hit by margin calls know that they can always get liquidity from the gold market to raise capital."Gold prices were seen down as deepening fears over Ireland's fiscal health sent the dollar higher against the euro, triggering a second round of broad liquidation across commodities.

The US Treasury Market remained lower amid increased criticism of the Federal Reserve's plan to stimulate growth and concern that a swelling U.S. deficit will lead to higher borrowing costs.Brian Edmonds, head of interest rates at Cantor Fitzgerald LP in New York said: "The article on the evaluation of U.S. ratings spooked the market a bit. It was an impetus for the last leg of the down trade," he said. "It's not a ringing endorsement of the first couple of rounds of QE. There are a lot of worries out there."German 10-year bunds closed lower.

POST COMMENT

Want to Learn How to REALLY Make Money With Article Marketing? (Try This First) Online Marketing MONOPOLY! How To Dominate Your Niche With Sites That ALMOST Build Themselves! 1 Sneaky Article Marketing Trick That Can Explode Your Views (Viral Marketing That Works!) Launching Your Sms Marketing Campaign Did You Get Lazy In Marketing? (if You Want More Clients, Do What You Used To Do) Marketing To Your List - Provide Them With Relevant Information To Position Yourself As An Expert Why Sell An Established or Profitable Website? Detecting Forex Positions with high Profit Potential Email marketing pointers Stock Market Strategies And Current Performance Colonix, Is It A Scam? Brain Evans-List Profit Bootcamp-Review Precision Measuring Instrument Manufacturers In Germany To Vigorously Develop The Asian Market