CANADA FX DEBT-C$ ends weaker but euro zone hope limits loss
* C$ ends at C$0.9908 vs US$ or $1.0093
* Equities, euro rally on Europe optimism
* Bond prices mostly lower
By Andrea Hopkins
TORONTO, Sept 14 (Reuters) - The Canadian dollar ended lower against the U.S. dollar on Wednesday but its losses were limited as some positive news on resolving the euro zone's debt crisis perked up risk appetite.
Global equities rallied and the euro rose as optimism over tentative steps to resolve Europe's debt crisis overcame still widespread fears that Greece will ultimately default on its debt. [MKTS/GLOB]
Stocks on Wall Street ended the day more than 1 percent higher after Europe's top bureaucrat said plans for a euro zone bond, seen by many as a key tool to ease the region's festering debt crisis, would soon be presented. [ID:nL3E7KE09F]
While the Canadian dollar typically follows U.S. equities, the currency ended the day slightly weaker although analysts said there could be more upside in the next few sessions.
"It's actually almost unchanged on the day, which is a little disappointing due to the fact we've seen a really strong rally in equities today after a bump in risk sentiment," said Steve Butler, director of foreign exchange trading at Scotia Capital.
"I wouldn't be surprised to see us maybe take out yesterday's lows at some point and maybe push back through that C$0.98 level. It just feels like equities are stabilizing and there is potential we might see a little bit of a bounce over the next couple days."
The Canadian dollar CAD=D4 ended the North American session at C$0.9908 to the U.S. dollar, or $1.0093 U.S. cents, down from Tuesday's North American session close of C$0.9854 to the U.S. dollar, or C$1.0148.
While U.S. retail sales data rose less than expected, the focus remained on Europe, where the European Commission said it would soon present options for the introduction of euro area bonds, a development investors saw as a significant step despite German opposition to the idea. [ID:nL3E7KE1P9]
"The developments out of Europe continue to be the most meaningful influence in currency valuations," said Jack Spitz, managing director of foreign exchange sales at National Bank Financial.
Canadian bond prices were mostly lower across the curve.
The two-year bond CA2YT=RR was up 1 Canadian cent to yield 0.938 percent, while the 10-year bond CA10YT=RR shed 4 Canadian cents to yield 2.204 percent. (Additional reporting by Claire Sibonney; editing by Peter Galloway)
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