(Reuters) - The U.S. dollar rose to its highest against the yen in over four years on Thursday, blasting through the 100-yen level, while shares in major markets slipped from recent record levels.
Investors sold the
low-yielding yen as ongoing support from central banks around the world
continues to push cash into higher-yielding assets. U.S. stocks fell slightly
after recent gains from a rally that has taken the S&P 500 to record closing
highs for five straight sessions.
The dollar got support from data
showing applications for unemployment insurance in the United States fell to the
lowest level in more than five years in the latest week.
"A stampede out
of safety and brightening U.S. job prospects helped catapult the dollar over the
key triple-digit threshold against the yen," Joe Manimbo, senior market analyst
at Western Union Business Solutions in Washington, said in a note.
yen is on track to post its eighth straight month of declines against the
greenback, shedding more than 30 percent since its September high near 77. A
mega-stimulus program unleashed by the Bank of Japan last month has helped
continue the weakening trend in the Japanese currency.
slipped but the recent uptrend remains intact.
"We've had such a
consistent upward move that investors need some real new news to keep the
momentum going," said Rick Meckler, president of hedge fund LibertyView Capital
Management LLC in Jersey City, New Jersey.
"The jobless claims were a
good number, but not enough of 'new news.' Investors want to see something that
shows a good pickup in economic activity."
Pull-backs have been short and
shallow despite recurring calls for a correction in U.S. equities. Globally, the
expectation of continued accommodative monetary policy from central banks has
maintained support for stocks.
The Dow Jones industrial average was down
23.66 points, or 0.16 percent, at 15,081.46. The Standard & Poor's 500 Index
was down 5.59 points, or 0.34 percent, at 1,627.10. The Nasdaq Composite Index
was down 1.16 points, or 0.03 percent, at 3,412.11.
The euro zone's Euro
STOXX 50 index dropped 0.4 percent, retreating from a near two-year high but
finding support at an upward trendline from lows hit on April 18. The
pan-European FTSEurofirst closed flat to stay near five-year highs.
MSCI world index, which tracks stocks in 45 countries, was down 0.8 percent
after earlier hitting its highest level since June 2008.
The U.S. currency strengthened across the board, with the dollar
index up 1 percent and above its 14- and 50- day moving averages.
euro was trading down 0.9 percent at $1.3024 after earlier hitting a high of
The euro was also pressured by slightly softer-than-expected
demand at a Spanish debt auction, while Spanish government bond yields
Oil prices dipped on a combination of weaker demand and rising
U.S. oil lost 69 cents to $95.93 while Brent crude fell 26
cents to $104.08 per barrel. The benchmark has slipped from a one-month high of
$105.94 touched on Tuesday after Israeli air strikes on Syria over the weekend
stoked supply fears.
"There's too much crude oil production in the world,
and when traders become worried about that, they end up selling," said Tim
Evans, energy specialist at Citi Futures Perspective.
increased crude oil output by 160,000 barrels per day to 9.3 million bpd in
April, industry sources said this week, adding to an already well-supplied
Spanish bond yields rose on speculation Madrid may be
planning another bond sale after borrowing costs fell at Thursday's auction of
just over 4.5 billion euros of new debt.
The country's 10-year bond
yields were 8 basis points higher at 4.19 percent, having moved away from the
2-1/2 year lows of 3.95 percent touched last week when the ECB cut rates and
said it would consider further policy easing.
The benchmark 10-year U.S.
Treasury note yield was above 1.8 percent for the first time in almost a
Gold prices fell after the strong U.S. jobs data, with dollar
strength weakening the price further. Spot gold was down 1 percent to $1,458.06.
The metal gained 1.4 percent in the previous session, its biggest one-day rise
in two weeks.