Last Update 21:43
Monday, 18 November 2019

Dollar rises as world stock markets hold firm

Reuters , Friday 27 May 2016
Views: 906
Views: 906

The dollar rose on Friday while world stock markets were steady, as investors prepared for a likely hike in U.S. interest rates in the next few months.

The MSCI All-Country World equity index .MIWD00000PUS edged higher by 0.1 percent, with trading volumes relatively light ahead of public holidays that will close London and New York markets on Monday.

The pan-European FTSEurofirst 300 index .FTEU3 of leading European shares was steady but remained around a one-month high reached earlier this week, while U.S. futures made slight gains.

"Markets are doing remarkably well given that a U.S. interest rate rise might happen as early as next month," said Lex Van Dam, hedge fund manager at Hampstead Capital.

The dollar index .DXY rose 0.1 percent and was on track for its best monthly performance since last November, after a string of U.S Federal Reserve officials indicated that rates could rise as soon as June given signs of strength in the world's biggest economy.

Investors will looking for further clues on the likely timing of a rate hike when Federal Reserve Chair Janet Yellen speaks later in the day.

"I'm not sure if U.S. interest rates will go up in June, but July is quite likely," said Clairinvest fund manager Ion-Marc Valahu, who added that he had recently canceled some earlier "short" positions that bet on the dollar losing ground.

A stronger dollar often lifts European stocks as weakness in the euro EUR= makes European companies' exports cheaper.

Some traders said stock markets were unlikely to make much headway in the coming month, however, given uncertainties like Britain's June 23 vote on its membership of the European Union.

"With the headwinds of a possible interest rate hike from the Federal Reserve, and the EU referendum in June, there might not be a huge amount of new money coming into the market," said Manoj Ladwa, head of trading at TJM Partners.

Search Keywords:
Short link:


Ahram Online welcomes readers' comments on all issues covered by the site, along with any criticisms and/or corrections. Readers are asked to limit their feedback to a maximum of 1000 characters (roughly 200 words). All comments/criticisms will, however, be subject to the following code
  • We will not publish comments which contain rude or abusive language, libelous statements, slander and personal attacks against any person/s.
  • We will not publish comments which contain racist remarks or any kind of racial or religious incitement against any group of people, in Egypt or outside it.
  • We welcome criticism of our reports and articles but we will not publish personal attacks, slander or fabrications directed against our reporters and contributing writers.
  • We reserve the right to correct, when at all possible, obvious errors in spelling and grammar. However, due to time and staffing constraints such corrections will not be made across the board or on a regular basis.

© 2010 Ahram Online.