Global shares fight back, oil slides as dollar momentum returns

Tue May 14, 2013 9:27am EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Marc Jones

LONDON (Reuters) - Signs the dollar was preparing for another move higher held down oil and gold prices on Tuesday and helped shares shake off worries over weaker-than-forecast German sentiment data.

Wall Street looked set to open up by the smallest of margins with investors still looking for clear directional catalysts after last week's repeated record highs.

After a surprising rise in U.S. retail sales boosted optimism about the recovery in the world's top economy on Monday, Germany's ZEW monthly sentiment survey underscored the uncertainty that continues to weigh on Europe.

The monthly poll of economic sentiment rose to 36.4 points from 36.3 in April, undershooting the consensus forecast in a Reuters poll of 30 economists of 38.3, with the institute blaming the miss on the euro zone's woes.

Europe's top shares on the FTSEurofirst 300 .FTEU3 had fallen after the data but gradually struggled back to positive territory by 1245 GMT as investors took the opportunity to get back into the market.

Monday's strong U.S. retail sales had prompted Goldman Sachs and JPMorgan to upgrade their view on second-quarter U.S. growth. More data will be released this week, including industrial production, housing starts and consumer sentiment.

Dan Morris, a macro strategist at JP Morgan, said the recent rise in the dollar was also a sign investors were becoming increasingly confident about U.S. growth.

"It is an indicator that the United States is doing better so that should generally be a positive signal for equities ... the only thing that has really changed is the perception now of (better) U.S. economic growth," he said.   Continued...

A man walks through the lobby of the London Stock Exchange August 5, 2011. REUTERS/Suzanne Plunkett