Stocks retreat from 8-month high, dollar up
By Rodrigo Campos
NEW YORK (Reuters) - World stocks were little changed after touching an eight-month high on Tuesday, while the dollar rose from the previous session's losses a day after the Federal Reserve signaled it would continue its loose monetary policy.
U.S. stocks closed near session lows after a more than 1 percent rally lifted the S&P 500 to a four-year high Monday, with a number of large-cap stocks at new 52-week highs as portfolio managers grabbed top performers near quarter-end. .N
The U.S. dollar strengthened against the euro and the yen after Fed Chairman Ben Bernanke's dovish comments sent it tumbling to multi-week lows in the previous session.
"Bernanke yesterday talked about the need for aggressive monetary policy and the dollar took a pretty good whack, so it's probably clawing some of that back," said Art Hogan, managing director of Lazard Capital Markets in New York.
Bernanke said Monday that accommodative monetary policy would stay in place to support demand and, over time, drive down long-term unemployment.
Asked on Tuesday about the potential for a new round of asset purchases by the Fed, Bernanke told ABC news the Fed does not take any options off the table and needs to be prepared to respond to however the U.S. economy evolves.
The S&P 500 is on track to close its best quarter since 2009 and its fourth straight month of gains. MSCI's main global stock index .MIWD00000PUS was up less than 0.1 percent after hitting its highest level since August 1.
Hogan said the Fed was only part of the equation behind stronger global equities. "We still believe there's a soft landing in China, Europe has stabilized and the U.S. continues to chug along at a sustainable rate," he said. Continued...