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US stocks falter as euro surge sends oil and gold futures to record highs

US stocks falter as euro surge sends oil and gold futures to record highs

Wall Street fell in early trading Wednesday as the dollar plunged against the euro, sending oil and gold to record highs.
The trends on other markets are worrisome for an economy that already faces a combination of inflation and an economic slowdown, or stagflation. Investors were eager to hear comments about the economy from Federal Reserve Chairman Ben Bernanke, who was scheduled to testify on Capitol Hill later Wednesday.
Investors want some indication as to whether the Fed is more concerned about the sagging economy or the risk of inflation; the central bank may have to choose whether to keep cutting rates to stimulate the economy, or halt rate reductions to cool inflation.
The euro hovered above $1.50 Wednesday. The weak dollar helped propel commodities to new highs overnight _ oil prices broke through a new intraday high of $102 a barrel in Singapore. In London, gold futures set a new high of $961.30 an ounce.
The Dow Jones industrials fell 32.89, or 0.26 percent, to 12,652.03.
Broader stock indexes were also off. The Standard & Poor's 500 index shed 4.35, or 0.31 percent, to 1,376.94; and the Nasdaq composite index dropped 10.16, or 0.43 percent, to 2,334.83.
Treasurys rose, pushing yields lower. The yield on the benchmark 10-year note, which opposite of the price, fell to 3.80 percent from 3.86 percent late Tuesday.
Oil futures were off their overnight highs. A barrel of light sweet crude rose 5 cents to $100.83 on the New York Mercantile Exchange.
Luxury homebuilder Toll Brothers Inc. swung to a first-quarter loss amid declining sales and more than $245 million (euro163 million) in write-downs. However, hope that the housing market's slump might be nearing a bottom pushed Toll up 37 cents to $23.49.
Nortel Networks Corp. announced a hefty $844 million (euro561 million) quarterly loss, and that it would cut 2,100 jobs. It fell $1.40, or 12.2 percent, to $10.05.
In economic news, a new report showed business investment in durable goods weakened more than forecast at the start of the year, playing into the nervousness about economic slowing.
The Commerce Department reported durable goods orders dropped 5.3 percent in January, exceeding the forecast of Thomson/IFR analysts. January orders for transportation goods plunged 13.4 percent. A December rise in durable goods spending was revised lower to 4.4 percent from 5 percent.
The Russell 2000 index of smaller companies fell 4.13, or 0.58 percent, to 713.19.


Updated : 2021-02-27 17:58 GMT+08:00