Gold holds above 8-1/2 month low; poised for third weekly dropREUTERS, Fri Sep 19, 2014 07:54 WIB - Gold held above its lowest in 8-1/2 months on Friday but was headed for a third...
Investors were also eyeing the results of Scotland's independence referendum to gauge the impact on the dollar, which was already trading near a four-year high against a basket of major currencies.
Spot gold was little changed at $1,224.64 an ounce by 0037 GMT, poised for a 0.3 percent drop for the week.
On Thursday, the metal fell to $1,216.01 - its lowest since early January - before recovering modestly to close up 0.2 percent.
Gold came under selling pressure after the Federal Reserve indicated on Wednesday it could raise borrowing costs faster than expected when it starts moving, though it renewed its pledge to keep interest rates near zero for a "considerable time."
Any increase in rates would dim the appeal of non-interest-bearing assets such as bullion.
Gold was also hurt after data showed that the number of Americans filing new claims for unemployment benefits fell more than expected last week, suggesting a sharp slowdown in job growth in August was an aberration.
At least 15 companies have expressed interest in replacing the century-old London gold benchmark, with a new system seen in place by the end of 2014 as banks effectively call time on the current process, two sources familiar with the matter said.
China launched a gold exchange open to foreign players for the first time on Thursday, putting the world's top bullion buyer on track to win a race to set the benchmark price in Asia.
In mining news, Mali plans to boost funding opportunities for its artisanal miners and to improve the policing of a sector that produces about a third of the country's gold exports, officials said on Thursday at the start of a mining reform meeting.
Sterling rose to a two-week high against the U.S. dollar and two-year peak against the euro on Friday, taking comfort from a poll showing support for Scotland to remain in the United Kingdom.
0600 Germany Producer prices Aug
0800 Euro zone Current account July
1400 U.S. Leading index Aug
Global shares rise on hot Alibaba IPO, sterling up after Scots voteREUTERS, Fri Sep 19, 2014 07:39 WIB - Asian shares edged higher on Friday, cheered by news of an eye-popping initial public...
Alibaba Group Holding (BABA.N) priced its IPO at $68 a share, the top end of the expected range, raising $21.8 billion on Thursday - one of the largest-ever stock offerings.
Sterling was up about 0.1 percent at $1.6425, after it rose to a two-week high against the dollar of $1.6461. A YouGov survey carried out on the day of the Scottish referendum showed support for independence amounted to 46 percent of the electorate, while 54 percent wanted to remain in the United Kingdom.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS added 0.1 percent in early trade, bolstered by Wall Street's cheer, where both the benchmark S&P 500 .SPX and the Dow Jones industrial average .DJI set intraday record highs.
Japan's Nikkei stock average .N225 added 0.7 percent, getting a tailwind from a weaker currency after the dollar pushed to a new six-year high of 108.96 yen on Thursday.
The dollar index .DXY, which tracks the U.S. unit against a basket of six major rivals, stood at 84.267 after it climbed as high as 84.743 on Thursday, its strongest level in more than four years.
The euro was steady at $1.2918 after refreshing a 14-month low on Thursday, dropping as low as $1.2834.
Risk sentiment was tempered by geopolitical clouds on the horizon. The U.S. Senate on Thursday approved a bill requested by President Barack Obama to train and arm of moderate Syrian rebels fighting Islamic State militants, which now goes to Obama to sign into law.
Obama said the strong bipartisan support showed Americans were united in the fight against Islamic State militants.
"The emergence of the militant group ISIS in Syria and Iraq, and recent increase in efforts to fight it, has ushered in a new era of geopolitical risk" in the Middle East and North Africa, strategists at Barclays wrote in a client note.
"We think the stage seems set for a prolonged period of heightened regional uncertainty, with risks potentially spilling over into global oil markets and other economies and financial markets in the region," they said.
U.S. crude Clc1 edged up about 0.1 percent to $1.35 to $93.11 a barrel, pressured by the weaker greenback, which makes dollar-priced commodities such as oil more expensive for buyers using other currencies.
Spot gold steadied at $1.225.40 an ounce early on Friday after fall to $1,216.01 in the previous session, its lowest since Jan. 2 on speculation about an earlier-than-expected U.S. interest rate hike.
Sterling advances as Scotland poll shows support for Union REUTERS, Fri Sep 19, 2014 07:10 WIB - Sterling rose to a two-week high against the U.S. dollar and two-year peak against the...
That came just after a referendum vote closed, helping push the pound more than a half U.S. cent to $1.6461, its highest since Sept. 4. The YouGov survey showed support for Scottish independence amounted to 46 percent of the electorate with 54 percent wanting to stay in the United Kingdom.
"The YouGov survey seems to have a fairly big sample size so I suspect it will be not that off the official result," said a trader at a Japanese bank.
The British currency last stood at $1.6435, up 0.2 percent from late U.S. trade and extending its bounce from a 10-month low of $1.6052 hit on Sept. 10.
Against the euro, it hit a two-year high of 78.48 pence per euro and climbed to a six-year high of 178.99 yen.
"The market seems to have priced in the high likelihood of the Unionists winning so reaction will likely be limited if they win, while if Scots vote for independence, there should be huge selling in sterling," said Tohru Sasaki, head of research at JPMorgan Chase Bank in Tokyo.
The U.S. dollar stood tall against the yen, after scaling a six-year high on Thursday as a drop in U.S. jobless claims reinforced the market's view of the diverging trajectory of interest rates between the United States and Japan.
The dollar rose as high as 108.965 yen on Thursday and last stood at 108.77 yen.
While other U.S. data on Thursday showed some weakness in home building and factory activity, they hardly dented the perception that the U.S. central bank will be well ahead of the likes of the Bank of Japan in tightening rates.
The Federal Reserve reiterated this week that near zero rates will be maintained for a considerable time, but policymakers also indicated they expect faster rate hikes next year and the year after.
That boosted yields on U.S. notes, and hence the yield appeal of the dollar.
The dollar index .DXY, a measure of the greenback's value against six currencies, climbed to 84.743, its strongest level in more than four years and last stood at 84.268.
The euro also hit a 14-month low of $1.2834 on Thursday before bouncing back higher and it last traded at $1.2917.
Dow, S&P 500 at records as Fed-driven rally continuesREUTERS, Fri Sep 19, 2014 05:24 WIB - U.S. stocks rose on Thursday, a day after the U.S. Federal Reserve kept intact its...
The Fed said Wednesday at the conclusion of a two-day policy meeting it would keep interest rates near zero for a "considerable time," language supportive of equities which some had expected to be dropped from the statement.
The central bank's outlook on Wednesday included forecasts for higher-than-expected rates in 2015 and 2016, which helped financial stocks .SPSY rise 1.1 percent, leading the day's gains on Wall Street. Goldman Sachs (GS.N) rose 1.7 percent to $187.89, the biggest boost to the Dow.
U.S. equity markets have rallied for three consecutive sessions as the Fed's stance eased investor worries the central bank was ready to pivot away from its years-long policy of holding rates at rock bottom levels, which stimulated demand for risk assets like stocks.
That support has lifted the benchmark S&P 500 to 34 records in 2014, and has helped markets sidestep a 10-percent "correction" for almost three years, even while individual market sectors have seen multiple pullbacks.
The climb to repeated record highs has coincided with steadily improving economic data, while the Fed's support has allowed investors to shrug off occasional weak numbers, like the August payrolls report. At the same time, low Treasury interest rates have pushed yield-hungry investors into equities.
U.S. housing starts and permits fell in August, but upward revisions to the prior month's data indicated gradual improvement in the housing market. A sharp drop in the number of Americans filing new claims for unemployment benefits last week suggested the slowdown in job growth last month was probably an anomaly.
"Things are starting to get a little better for the banks in general and that really does help the financials," said Patty Edwards, managing director for investments at U.S. Bank Wealth Management in Seattle.
"You are seeing low growth starting to improve some, you are starting to see all the things that would turn in an economy."
The Dow Jones industrial average .DJI closed up 109.14 points, or 0.64 percent, to 17,265.99, the S&P 500 .SPX added 9.79 points, or 0.49 percent, to 2,011.36, and the Nasdaq Composite .IXIC gained 31.24 points, or 0.68 percent, to 4,593.43.
After the closing bell, Oracle Corp (ORCL.N) shares fell 2.2 percent to $40.64. The business software maker reported quarterly results and said long-time chief executive Larry Ellison will become executive chairman and chief technology officer, with executives Safra Catz and Mark Hurd taking over the CEO role.
Advancing issues outnumbered decliners on the NYSE by 1,845 to 1,200, for a 1.54-to-1 ratio on the upside; on the Nasdaq, 1,622 issues rose and 1,083 fell for a 1.50-to-1 ratio favoring advancers.
The S&P 500 posted 56 new 52-week highs and 8 new lows; the Nasdaq Composite had 85 new highs and 64 new lows.
Volume was active, with about 5.88 billion shares traded on U.S. exchanges, slightly above the 5.69 billion average so far this month, according to BATS Global Markets.
Dollar surges to six-year peak on yen, Tokyo stocks cheerREUTERS, Thu Sep 18, 2014 07:59 WIB - Japanese shares jumped on Thursday after the dollar vaulted to a six-year peak on the...
The euro skidded to a 14-month trough while gold hit an eight-month low as the dollar swept higher across the board, a move that many investors have been itching to wager on all year.
Indeed, the hawkish interpretation in currencies came despite the Fed maintaining language suggesting that rate hikes would not happen for a "considerable time."
The reaction also overshadowed a surprisingly soft reading on U.S. inflation, even as Fed Chair Janet Yellen emphasized that policy would be highly dependent on how the economy actually performed in coming months.
"Overall, we feel that the forward guidance from the Fed is consistent with policy normalization in 2015," said Dylan Eades, an economist at ANZ.
"Whilst the timing of the first rate rise is data dependent, we continue to expect that the FOMC will begin the normalization process in March next year."
Futures markets <0#FF:> still lean more toward a move in June. But whatever the timing, U.S. rates do seem certain to be heading higher while central banks in the euro zone and Japan remain committed to super-easy monetary policy.
That stark contrast sent the euro sinking as far as $1.2833, depths last visited in July 2013. Measured against a basket of currencies, the dollar climbed to 84.753, the highest in 14 months.
The dollar also flew to 108.69 yen, its highest since September 2008 and up from 107.00 before the Fed statement.
A weaker yen is generally viewed as positive for Japanese exports and company earnings, helping lift the Nikkei .N225 0.9 percent to its best since January.
The broad Topix index .TOPX climbed 1 percent to tread ground not visited since July, 2008.
The yen's fall was timely as Reuters latest poll of Japanese manufacturers showed confidence dropping by the most in two years in September as a tax increase hit the economy harder than expected.
SCOTTISH VOTE STILL TO COME
Elsewhere in Asia, the reaction in equities was more guarded as the prospect of rising U.S. yields could attract funds away from emerging markets.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dipped 0.4 percent.
Wall Street seemed to find some relief in the fact that the Fed would not be hiking for a few months at least.
After whipsawing in a wide range, the Dow .DJI settled 0.15 percent higher, while the S&P 500 .SPX gained 0.13 percent and the Nasdaq .IXIC 0.21 percent.
Bond investors reacted with more calm than those in currency markets, and nudged yields on the benchmark 10-year note up a modest 2 basis points to 2.62 percent.
Still, a rise in two-year yields to 0.57 percent widened their premium over German debt to 63 basis points, the fattest margin since early 2007.
With the Fed out the way, the next big test for markets will be the referendum on Scotland's independence later Thursday.
Voting ends at 5 p.m. ET and exit polls are expected shortly after, giving Asian investors the first chance to react very early on Friday.
The latest opinion poll by Survation showed support for staying in the United Kingdom is at 53 percent, giving sterling a mild lift. The pound was at $1.6264, having been as low as $1.6052 earlier in the month.
In commodities, the rise of the dollar was a dead weight on prices. Gold was down at $1,220.86 an ounce having touched an eight-month trough.
Oil prices were further pressured by a government report showed crude stocks rose sharply in the United States last week.
Brent crude LCOc1 was down 39 cents on Thursday at $98.56 a barrel, while U.S. crude Clc1 fell 46 cents to $93.96.