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US stocks volatile on weak dollar | |
(about 2 hours later) | |
US shares were volatile in Thursday trading, hit by the weak dollar and news that a unit of private equity group Carlyle was near collapse. | |
Sentiment was further knocked by record oil prices, prompting investors to move money to haven assets such as gold. | Sentiment was further knocked by record oil prices, prompting investors to move money to haven assets such as gold. |
The main Dow Jones index was down 59.51 points, or 0.5%, at 12,050.73, after earlier being as much as 1.8% lower. | |
European and Asian stocks had finished lower, and analysts warned of more market volatility in coming weeks. | |
'Dominant factor' | 'Dominant factor' |
Earlier in the day, the price of a barrel of benchmark US light crude oil passed $110 in Thursday trading, while gold hit $1,000 for the first time. | |
We are entering dollar crisis mode Currency economist Derek Halpenny | |
Economic concerns and the weak dollar overshadowed Tuesday's announcement that central banks would inject more than $200bn (£98bn) into money markets to ease the credit crunch and stimulate lending. | Economic concerns and the weak dollar overshadowed Tuesday's announcement that central banks would inject more than $200bn (£98bn) into money markets to ease the credit crunch and stimulate lending. |
US investor sentiment was further hit by official figures showing a larger than expected fall in American retail sales in February. | US investor sentiment was further hit by official figures showing a larger than expected fall in American retail sales in February. |
"The dollar will remain the dominant factor until the Federal Reserve meeting next Tuesday," said analyst Olivier Jakob of Petromatrix. | "The dollar will remain the dominant factor until the Federal Reserve meeting next Tuesday," said analyst Olivier Jakob of Petromatrix. |
"But oil will also have to balance with equities under the pressure of more credit hedge funds going belly-up." | "But oil will also have to balance with equities under the pressure of more credit hedge funds going belly-up." |
The UK's main FTSE 100 index closed down 84 points, or 1.5%, at 5,692. | |
Germany's Dax lost 1.5%, France's Cac gave up 1.4%, and Japan's Nikkei closed down 3.3%. | |
"We are entering dollar crisis mode," said Derek Halpenny,currency economist at BTM-UFJ in London. | |
"Looking at the markets there is a complete loss of confidence and that's because the markets are concerned over the US financial sector and ultimately what the FederalReserve will be forced to do to support that sector." |