Global equities fall as oil sinks; dollar rallies

Thu Feb 26, 2015 4:41pm EST
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By Sinead Carew

NEW YORK (Reuters) - Global equities dipped on Thursday as investor enthusiasm was dampened by a pullback in oil prices related to rising inventories, while the dollar rose as economic data drove expectations that the Federal Reserve will raise interest rates.

The U.S. S&P 500 .SPX ended down, led by an 1.8 percent drop in energy shares .SPNY. Brent crude .LCOc1 settled down 2.6 percent and U.S. crude CLc1 fell 5.5 percent.

The Nasdaq .IXIC was a bright spot in U.S. equities, rising on news of a technology deal as it drew closer to its lifetime peak, hit in 2000.

U.S. consumer prices fell in the 12 months through January, the first such decline since 2009 as gasoline prices continued to tumble, but core prices, which exclude volatile items such as food and gasoline, rose more than expected.

The MSCI All-Country World equity index .MIWD00000PUS was down 0.2 percent after having hit a record high of 434.40 points earlier in the trading day.

The dollar rose to a one-month high against a basket of currencies, as the data on core inflation and data showing a rise in U.S. durable goods orders supported bets that the Federal Reserve will raise interests rates.

The president of the San Francisco Fed, John Williams, in an interview on Fox Business Network on Thursday, said that the Fed will probably start raising interest rates "sometime this summer, or this fall" as inflation bottoms out and begins to recover.

The comments followed congressional testimony by Fed Chair Janet Yellen, this week, that the U.S. central bank would consider rate hikes on a "meeting-by-meeting" basis.   Continued...

Traders are pictured at their desks in front of the DAX board at the Frankfurt stock exchange February 24, 2015.  REUTERS/Stringer/Remote