Sharp decline in U.S. dollar lifts stocks, oil
By Ryan Vlastelica
NEW YORK (Reuters) - The U.S. dollar fell sharply on Friday and posted its biggest weekly decline against the euro in more than three years, helping to drive a rally in Wall Street stocks and crude oil.
The Nasdaq posted its highest close in 15 years on Friday and had a weekly gain of 3.2 percent.
Riskier assets like equities had a strong week in general, largely driven by the Federal Reserve's policy statement on Wednesday, which struck a more dovish tone than investors had expected. The Fed appeared to argue against an interest rate hike in June.
The U.S. dollar index is up more than 20 percent since mid-2014. The dollar's strength for some time buoyed U.S. stocks because it served as evidence of a strengthening economy, but lately there have been concerns of the impact it could have on the profits of U.S. multinational companies.
U.S. crude futures had their first weekly advance of the past five, and the S&P 500 snapped a three-week losing streak on Friday. The euro EUR= posted its biggest weekly jump against the dollar in more than three years, while the U.S. dollar index suffered its biggest weekly drop since 2011.
The dollar index .DXY, which measures the greenback against a basket of currencies, fell 1.37 percent, its biggest one-day decline since September 2013. The euro rose 1.4 percent, to $1.0811, and the yen JPY= rose 0.61 percent against the dollar.
"This is just some counter-trend correction in the dollar and is transitory," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
Wall Street stocks surged, with the Dow and the S&P 500 both gaining almost 1 percent on Friday. For the week, the Dow rose 2.1 percent and the S&P rose 2.7 percent. Continued...