Global stocks, dollar ease as stimulus seen less certain

Thu Aug 23, 2012 11:08am EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Herbert Lash

NEW YORK (Reuters) - Global shared retreated and the U.S. dollar weakened on Thursday after expectations for further stimulus from the Federal Reserve were dampened and data from Europe and China pointed to a slowing global economy.

The dollar pared some of its losses against the euro after the president of the St. Louis Federal Reserve said data since the last policy-makers' meeting was somewhat better and that minutes from that meeting were "a bit stale".

The U.S. dollar index .DXY down 0.02 percent at 81.472, while the euro rallied to a fresh seven-week high against the dollar, up 0.3 percent at $1.2564.

Minutes from the July 31-August 1 meeting hinted that another round of monetary easing would occur "fairly soon," but James Bullard of the St. Louis Fed told CNBC television that the economic outlook has since brightened.

Stocks on Wall Street opened lower and European shares extended losses as the outlook for the global economy sapped investor sentiment.

The Dow Jones industrial average .DJI was down 96.48 points, or 0.73 percent, at 13,076.28. The Standard & Poor's 500 Index .SPX was down 9.20 points, or 0.65 percent, at 1,404.29. The Nasdaq Composite Index .IXIC was down 24.51 points, or 0.80 percent, at 3,049.16.

In Europe, the FTSEurofirst 300 .FTEU3 of top regional shares was down 0.8 percent at 1,086.84.

The Purchasing Managers' Index survey from Markit suggested that the euro zone was destined to return to recession, as the poll notched up a seventh month of contraction.   Continued...

A worker on the IG Group's trading floor looks away from his screens in the City of London, October 4, 2011. REUTERS/Olivia Harris