London equities markets were mixed on Monday. The FTSE 100 was 0.2 percent lower to 6,194.2 as dropping metals prices sent the UK mining sector lower. Meanwhile, the FTSE 250 was 0.5 percent higher, closing at 10,712.8. It was the fifth session in a row that the 250 has done better than the 100.
Homebuilders were mixed on the session. Berkeley Group added 6.8 percent to reach a new high of £17.02 on rumors that a consortium had bid for peer Crest Nicholson. The gain brought Berkeley’s advance over six sessions to 19 percent. Crest Nicholson, on the other hand, was 0.1 percent lower to 615p even though it was believed that its institutional shareholders will wait for a higher offer.
The insurance sector was higher, mainly on Resolution’s announcement that it is discussing deals with several other insurers. The life assurer added 5.1 percent to 667½p. Different analysts suggested different deals, including one with Scottish Widows the life assurance division of Lloyds TSB, with the UK life division of Prudential, or with Friends Provident. The talk sent Lloyds TSB up 1 percent to 561p, while Friends Provident added 1.3 percent to 214½p and Prudential gained 2.1 percent to 651½p.
In the mining sector Rio Tinto was 4 percent lower to £27.65, while Xstrata dropped 4.5 percent to £21.92, Kazakhmys fell 5 percent to £11.40 on lower copper prices, and Antofagasta was 5.3 percent lower to 468¼p.
In Europe on Monday the FTSE Eurofirst 300 closed 0.2 percent higher to 1,466.64 as the corporate earnings season continued to produce more positive surprise than negative ones.
In the construction sector, German group Bilfinger Berger added 1.7 percent to €48.40 after its first nine months were better than had been anticipated. The results earned the German builder an upgraded target share price from WestLB. Likewise, Spanish builder Sacyr Vallehermoso closed 15.2 percent higher to €54 on an increase in core earnings in its first nine months.
Deutsche Telekom added 2.6 percent to €13.48 and went as high as €13.62 during the day on the news that its chief executive had resigned and been replaced by the head of its mobile phone unit. Broker reaction was mixed. Morgan Stanley stuck with its rating of “overweight” and raised its target share price for the German telecom company from €13.10 to €13.50. Bear Stearns, on the other hand, repeated its recommendation of “underperform”, saying that a new chief executive would not make much of a difference on a board where the union controls nearly half of the seats.
Losers on the day included Novartis, which dropped 1 percent to SFr72.95 after it was announced that a US Food and Drug Administration decision on the approval of its diabetes drug, Galvus, for use in the United States, will be delayed for three months.
Tokyo equities markets saw decline on Monday as the Nikkei 225 fell 0.6 percent to 16,022.46 after going below 16,000 earlier in the day. The Topix index was 0.8 percent lower to 1,568.76.
The losses came on anticipated gross domestic product figures, due Tuesday, which many expect will say that the Japanese economy only grew at a 1 percent annual rate in the third quarter. If these figures turn out to be correct, it would be the slowest expansion in the Japanese economy since 2004. Furthermore, data released Friday showed that machinery orders were down 7.4 percent in September from the same month last year. Both news items increased concerns that Japan’s economic recovery is losing momentum.
Declining demand for fixed-line telephones led to a 9.4 percent drop in operating profits in the fiscal first half for NTT, which dropped 1 percent on the session to ¥571,000.
Video game and slot machine maker Sega Sammy fell 8.4 percent to ¥2,030 on a full-year profit prediction that was lowered by 20 percent.
In the retail sector, Fast Retailing closed 2.3 percent lower to ¥9,990. In other domestically-focused sectors, SMFG, one of Japan’s leading banks, dropped 1.6 percent to ¥1.22 million, while machinery products manufacturer Fanuc fell 0.9 percent to ¥10,360.
Crude oil prices dropped on Monday after it was reveled that Saudi Arabia has decided that it will sell more oil to some of its Asian customers in December. While it seemed that this move was in opposition to its agreement to cut oil output with other OPEC members, some analysts said it was too soon to tell whether it was really violating the production decision or would take all of its cuts from sales to the United States and Europe.
Brent crude for December delivery dropped 75 cents to $58.96 per barrel in London, while West Texas Intermediate crude December contracts were 98 cents lower to $58.61 per barrel on the New York Mercantile Exchange.
In the metals markets on Monday, prices were down almost universally. The exceptions were in aluminium and nickel prices. Aluminium was 0.7 percent higher to $2,714 per tonne, while nickel added 1 percent to $29,700 per tonne.
Copper led the declines among base metals. It ended the session at $6,917 per tonne after going as low as $6,761 per tonne earlier in the day. Prices for the metal has dropped nearly 11 percent since the middle of October as inventories in London Metal Exchange warehouses have added 3,100 tonnes - 38 percent - to 151,300 tonnes. Elsewhere in base metals, zinc dropped 1.5 percent to $4,235 per tonne after dropping as low as $4,020 per tonne, while lead declined 5.7 percent to $1,580, $130 higher than its lowest point on the session.
In precious metals, gold dropped 0.9 percent to $622.80 per troy ounce as the dollar firmed and oil prices fell, while platinum fell 1 percent to $1,194 per troy ounce.
The Japanese yen weakened on Monday on fears that an expected interest rate hike could reverse that nation’s economic recovery. Analysts expect the rate to go up before the new fiscal year begins in April 2007, but both the policy chief of the ruling Liberal Democratic party and a former financial services minister have said that raising rates too quickly could harm Japan’s economy.
By mid-afternoon in New York, the yen had lost 0.2 percent in relation to the euro to ¥151.34 and it was 0.5 percent lower versus the US dollar, to ¥118.15.
Sterling was lower as well, on weaker economic data than had been anticipated. Initially higher against the dollar, the UK currency dropped 0.5 percent to the greenback to $1.9015, while the UK currency was down 0.2 percent to £0.6732 against the euro.
The US dollar was 0.2 percent higher in relation to the euro to $1.2834 even though talk continued over last week’s comments from China that it is planning to diversify its foreign exchange reserves. Monday the talk continued as China’s State Information Centre, a think tank supported by the Chinese government, recommended that China should extend diversification by building its strategic reserves of bulk commodities, metals, and oil.
The Swiss franc added 0.2 percent versus the euro to SFr1.5935 on comments from the chairman of the Swiss National Bank that interest rate increases could help strengthen the currency there.
Lower metals prices hurt the Australian dollar, the Canadian dollar, and the South African rand as all fell in relation to the US dollar. The Canadian dollar dropped 0.5 percent to C$1.1374 against the greenback, while the Aussie fell 0.6 percent to $0.7625 to the US dollar, and the rand was 0.8 percent lower to R7.2535 to the dollar.
The New York equities markets were higher at noon on Friday, with the Dow Jones Industrial Average 0.9 percent higher to 12,176.54, while the Nasdaq Composite was up 2.3 percent to 2,384.64 and the S&P 500 had added 1.1 percent to 1,378.94.
Defense companies that saw losses right after Tuesday’s elections regained some of those declines later in the week but still ended the week below their starting levels. Raytheon fell 0.2 percent during the week to $48.90, while Lockheed Martin dropped 1 percent to $86.10 and Northrop Grumman was 1.8 percent lower to $64.73.
Health sectors were affected by the elections on concerns that their prices could be driven down by decisions from the new Democratic majority in Congress. Among the pharmaceuticals companies, Johnson & Johnson fell 3 percent to $65.80, while Pfizer declined 3.7 percent to $25.58 and Merck ended the week 4.9 percent lower to $42.88.
Wal-Mart was 2.2 percent lower on the week to $46.49 on the fears of investors that the new Congress could raise the minimum wage and move to regulate labor more closely.
Homebuilders saw declines as the housing market continued to suffer. Toll Brothers dropped 2.3 percent to $27.59, while DR Horton fell 2.4 percent on a downgrade from Merrill Lynch and Pulte Homes was 2.6 percent lower to $29.32.
Gainers on the week included Four Seasons Hotels, which added 28.3 percent to $81.97 after a private consortium of bidders offered $3.7 billion for the luxury hotel group. OSI Restaurant Partners was 21.6 percent higher to $39.45 after it accepted a $3 billion private bid.
The FTSE 100 dropped 0.37 percent on Friday to end the week at 6,208.4 in a week where at least some stocks in the UK were affected by the elections in the United States on Tuesday.
The pharmaceuticals sector declined in the wake of the Democratic takeover of both houses of Congress on the concern that drug prices could be affected by legislation promised by House speaker-elect Nancy Pelosi to allow direct governmental negotiation of drug prices for recipients of Medicare. GlaxoSmithKline dropped 1.8 percent to £13.61, while AstraZeneca was 2.8 percent lower to £30.03.
Utilities were lower on speculation about takeovers in the sector after Scottish Power said that it had been approached by Spain’s Iberdrola. International Power dropped 1.6 percent to 338¼p, while Severn Trent was 1.7 percent lower to £14.03.
Among the mid-caps, homebuilder Crest Nicholson was 8.9 percent higher to 622½p after it rejected an offer from a group that included the Bank of Scotland.
Miners were higher on positive broker comments and bids rumors. Anglo American added 2.8 percent to £25.56 after one of the richest men in China bought a 1.1 percent stake in the miner, raising speculation that there could be a bid for the company out of China. Lonmin added 8.6 percent to £33.55 after Morgan Stanley raised its target share price to £40.
European equities markets were higher this week as earnings reports continued to be largely positive and mergers and acquisitions activities continue. The FTSE Eurofirst 300 was up a bit more than 1 percent during the week to 1,464.19. In France, the CAC-40 added 1.4 percent to 5,447.5, while in Germany the Xetra Dax gained 1.9 percent to 6,357.77.
In the banking sector, Sampo added nearly 11 percent over the week to €18.82 and Danske Bank added 1.5 percent to DKr252 after Sampo agreed to a takeover of its banking unit by Danske, which will pay DKr30.1 billion ($5.2 billion) in cash. Elsewhere in the sector, however, Natexis Banques Populaire dropped 6.1 percent to €209.
Sacyr Vallehermoso added 6 percent on Friday and 13.3 percent during the week to €46.80 on rumors that it has increased its stake in Spanish oil company Repsol to as high as 15.2 percent. The move, which has yet to be confirmed by Sacyr, would make the Spanish construction group Repsol’s largest shareholder. Repsol, meanwhile, was 4.3 percent higher this week to €27.80.
Ryanair added 5.1 percent over the week to €9.42 and rose as high as €9.66, a new record, at one point after it upgraded its full-year target for profits.
IEA predicts demand growth of 2.4 million barrels/day in Q4
The price of crude oil was lower on Friday even though the International Energy Agency said that demand for oil around the world will be “exceptionally strong” in the fourth quarter of the year, with tighter markets due to winter consumption and OPEC production cuts. The IEA said that demand will be up by 2.4 million barrels a day through the end of 2006.
Brent crude for December delivery dropped 97 cents to $60.35 per barrel, while December contracts for West Texas Intermediate crude were 95 cents lower to $60.21 per barrel. Even with these declines, however, prices for both Brent and WTI were 1.9 percent higher over the week.
In the metals markets on Friday gold was as high as $636.50 per troy ounce after comments from China that it is looking to diversify its foreign exchange reserves. By late afternoon in London, however, the price of gold had fallen to $628.80 for a gain of only 0.1 percent on the week. Meanwhile, platinum added 0.4 percent over the week to $1,227 per troy ounce on talk that an exchanged traded fund might be introduced.
In base metals, lead was a bit weaker this week, ending at $1,675 per tonne after going to a new record high price of $1,750 earlier on Friday. Zinc was slightly higher on the week as it fell to $4,300 per tonne after also finding a new record, $4,580 per tonne, early in the day on Friday. Inventories of zinc dropped to 95,200 tonnes in London Metal Exchange warehouses. Nickel saw big declines over the week, ending at $29,400 per tonne, a decline of 6.4 percent on the week.
The US dollar lost value over the week as the governor of the People’s Bank of China said that his nation is looking to diversify its foreign exchange reserves. This, coupled with an announcement on state television in China that forex reserves there were above $1,000 billion for the first time in history and comments from the director of China’s National Economic Research Institute that the imbalance between US and Chinese currency is the fault of the US Treasury for printing too much money, all spurred sell-offs of the greenback. Not all analysts, however, saw the remarks as the real problem and said that they were just being used as an excuse to sell.
The dollar lost 0.4 percent during the week to the Japanese yen, to ¥117.50, while it dropped 0.7 percent to $1.9140 in relation to sterling and fell 1.1 percent to $1.2860 versus the euro.
The euro also strengthened in relation to sterling and the yen. The shared currency was 0.6 percent higher to £0.6720 against sterling, while it added 0.7 percent against the yen, to ¥151.05. Some of the euro’s strength came after comments from European Central Bank officials that indicated there are more interest rate hikes to come.
Technology-related sectors were up in New York on Thursday but health care and pharmaceuticals companies were lower, resulting in mixed results on Wall Street at midday. The Dow Jones Industrial Average was 0.3 percent lower to 12,142.37, while the Nasdaq Composite added 0.42 percent to 2,395.03 and the S&P 500 dropped 0.04 percent to 1,385.12.
In health sectors, Johnson & Johnson was 1.25 percent lower to $70.29 and Pfizer fell 1.8 percent to $26.14. HealthSouth was 6.1 percent lower to $20.65 after its report for the third quarter showed losses related to price pressure in all its units, while it had fewer patients in its acute-care hospital unit. Elsewhere, 3M was a bit lower to $79.24 on the news that it is selling its pharmaceuticals interests.
Cisco Systems added 7.3 percent to $26.93 on a report that its net income was $1.61 billion in the quarter. Computer maker Dell gained 2.8 percent to $24.85 after it said it will expand its customer call center in Ottawa, adding 1,000 employees. Apple Computer, meanwhile, was 1.64 percent higher to $83.80 on reported interest in its new iPod Shuffle.
The oil sector was higher on gains in the price of crude oil, with ExxonMobil and Chevron each adding 1.1 percent, to $74.64 and $70.29 respectively.
The media sector was mixed. News Corporation added 0.2 percent to $21.90 on a better than anticipated quarterly report, while Disney gained 1.2 percent to $33.48 ahead of its report, due later in the day. Viacom, however, was 2.2 percent lower to $38.81 after its third quarter report showed that profits were down by 16 percent in the third quarter.
Mixed news on the US economy the FTSE Eurofirst 300 lower on Thursday as concerns about that issue outweighed mergers and acquisitions activity in banking. The Eurofirst was 0.2 percent lower to 1,467.27.
Banks were in focus on the session as the sector was mixed on bids and earnings news. Financial services group Sampo added 7.8 percent to €19.08 on the news that it will sell its banking unit, Sampo Bank, to Danske Bank of Denmark for DKr30.1 billion in cash. Danske Bank dropped 4 percent to SKr252 on analyst opinion that it is spending too much to buy Sampo Bank.
Allied Irish Banks were 0.3 percent higher to €21.87 on a report that its Polish division, Zachodni WBK, saw a gain of 29 percent in profits in the third quarter as more people in Poland took out mortgages. Greek bank Piraeus added 1 percent to €23 on upgrades from JP Morgan and Investment Bank of Greece. Investment Bank raised its recommendation of Piraeus from “accumulate” to “buy”, while JP Morgan upped its target share price from €26 to €28, citing its performance in the third quarter. On the other hand, Raiffeisen International dropped 3.2 percent to €86.60 despite a tripling of net profits in the quarter. The decline was due to losses on loans in Russia and Ukraine.
Elsewhere, Belgian brewer Inbev added 2 percent to €46.03 on a third-quarter report of net profits that were 25 percent higher due to growth in eastern Europe and Latin America. The third-quarter figures were higher than had been anticipated.
In the energy sector, Spanish power generator Iberdrola dropped 1.8 percent to €35.46 on the announcement that is thinking of bidding for Scottish Power in the UK.
Crude oil prices were higher on Thursday as the winter demand season approaches and natural gas inventories dropped more than had been anticipated. In addition, more and more signs point to another production cut by the Organization of Petroleum Exporting Countries before the end of the year. However most traders are said to be waiting to see how much of an effect the current OPEC cut will have on supply and prices.
There is some worry that non-OPEC oil producers could find it difficult to make up for OPEC’s reduced output. Norway’s production, for example, was down by 12.3 percent year on year in September and data indicates that the weak output continued into October.
December contracts for Brent crude added $1.29 to $60.87 per barrel in London, while West Texas Intermediate crude for December delivery gained 92 cents to $60.75 per barrel.
Natural gas prices were higher as well after new figures showed that the US stockpile dropped by 7 billion cubic feet, much more than the 4 billion cubic feet decline that had been expected for last week. Nymex Henry Hub added 30 cents to $8.12 per million British thermal units.
As expected, the Bank of England’s Monetary Policy Committee raised interest rates by 25 basis points to 5 percent on Thursday, but the statement that accompanied announcement of the rate hike provided little guidance as to where rates will go in the future. The lack of information spurred a sell-off that sent sterling lower versus the euro. The UK currency dropped 0.6 percent in relation to the shared currency to £0.6732.
The euro was also helped by remarks from a member of the executive board of the European Central Bank that implied that further interest rate hikes in the Eurozone are coming up. Lorenzo Bini Smaghi said in Milan the current price of borrowing money is “too accommodating”. The euro added 0.7 percent to ¥151.40, yet another new record high.
The US dollar continued to weaken as it was reported that the nation’s trade deficit narrowed less than had been expected, to $64.3 billion. Also damaging the dollar was a statement from the governor of the People’s Bank of China that it was planning to diversify its foreign exchange reserves, which now are around 70 percent in US currency. The greenback was 0.1 percent lower against both the yen and sterling, to ¥117.80 and $1.9070 respectively, while it dropped 0.7 percent versus the euro to $1.2840.
Weak employment data in Australia sent the Australian dollar 0.4 percent lower against the dollar, to $0.7670 as the figures were said to be another sign that interest rates there have hit their ceiling for now.
Prices and yields on US Treasury bonds were mixed on Thursday on data that was equally mixed. The trade deficit narrowed less than had been expected in September. On the other hand, consumer confidence was lower in the US, with the University of Michigan’s consumer confidence index down to 92.3 when a figure of 93.6 had been expected. In addition import prices were lower and unemployment claims were also down. Another factor in the day’s moves was relatively low interest in an auction of three-year paper on Wednesday; however, analysts were still optimistic for an upcoming auction of ten-year bonds.
At midday in New York, yields on the ten-year Treasury bond had dropped 0.2 basis points to 4.635 percent, but two-year yields were up b y 0.7 basis points to 4.756 percent.
In Europe, prices for longer-dated government bonds were higher but shorter-dated bonds held steady on the expectation that the European Central Bank will issue another interest rate hike in December. The two-year Schatz sat at a yield of 3.731 percent, while the ten-year Bund dropped 0.7 basis points to a yield of 3.740 percent.
Gilt prices in the UK were higher after the Bank of England’s Monetary Policy Committee raised interest rates, as had been expected. The two-year gilt fell 1.6 basis points to yield 5.073 percent, while the ten-year gilt dropped 2.9 basis points to 4.544 percent.
In Japan, the ten-year JGB dropped 2 basis points to a yield of 1.7 percent ahead of new gross domestic product date, to be released next week.
The New York equities markets were lower during the day on Wednesday in reaction to election results that put control of the US House of Representatives in the hands of the Democratic Party for the first time in 12 years. Investors believed that some sectors of the business community would be subject to stricter regulation under the Democrats than they have been with a Republican majority in power.
The Dow Jones Industrial Average was 0.2 percent lower to 12,135.16, while the Nasdaq Composite had dropped 0.08 percent to 2,373.99 and the S&P 500 fell 0.1 percent to 1,381.1.
Defense-related stocks saw declines. Boeing dropped 0.4 percent to $84.18, while Northrop Grumman lost 1.3 percent to $65.53, Lockheed Martin was 1.4 percent lower to $86.24, and Raytheon declined 2 percent to $48.70.
The pharmaceuticals sector was lower as well. Pfizer was 1.8 percent lower to $25.56, while Merck fell 3.5 percent to $44.29. On the other hand, biotech company StemCells added over 10 percent to $3.39 on the theory that it’s research into stem cell-based therapies for central nervous system diseases would get more support from a Democratic house than it has under the Republicans.
In the retail sector, Wal-Mart dropped 1 percent to $47.17 on investor concern that a Democratic House will put more pressure on the discount retailer on the issue of working conditions for its employees. Elsewhere in the sector, Federated Department stores fell 1.2 percent to $39.87 after it reported that it lost 1 cent per share in the third quarter.
European markets down after US House changes hands
The European equities markets were lower on the session Wednesday as investors worried about what effect the new Democratic majority in the House of Representatives in the United States would have on business. The FTSE Eurofirst 300 dropped 0.7 percent to 1,469.90. Elsewhere, the Xetra Dax in Germany was 0.2 percent lower to 6,318.43, London’s FTSE 100 fell 0.1 percent to 6,208.1, and the CAC 40 was even in Paris.
The MAN/Scania takeover story was in the news again after it seemed less likely that MAN’s attempt to purchase Scania would be successful. Part of this feeling was due to the fact that on Tuesday Investor, one of Scania’s largest shareholders, had increased its voting share in the Swedish truck-maker to 20 percent. Another factor might be the sudden resignation of Volkswagen’s chief executive. Volkswagen is also a major shareholder in Scania.
Scania’s A shares, with most of its voting rights, dropped 2.1 percent to SKr507, while its B shares fell 2.4 percent to SKr482. Investor was 0.9 percent lower to SKr162.50, while Volkswagen dropped 1.5 percent to €80. Only MAN saw gains, adding 0.2 percent to €73.
Aerospace company EADS added 3.2 percent to €21.33 on sales that were 14 percent higher in the third-quarter even though delays in the delivery of its A380 super jumbo jet have brought cancellations of some orders for the new aircraft.
The Tokyo equities markets were lower on Wednesday on sell-offs in the telecommunications sector. The Nikkei 225 dropped 16,215.74, a decline of 1.1 percent, while the Topix index was 1.2 percent lower to 1,597.50.
The automobile manufacturing sector saw gains. Toyota Motor added 1.8 percent to ¥7,230 after it reported record profits in an interim report and predicted that operating profits for the full year will be at ¥2,200 billion. Isuzu Motor, meanwhile, added 12.1 percent to ¥465 on the news that Toyota will acquire a 5.9 percent share in the company.
In the telecommunications sector, Softbank dropped 4.1 percent to ¥2,340 in anticipation of the release of an earnings report. After the close, it said that it had seen profit in the first half of its fiscal year on acquisitions in its telecoms operations and better performance in its internet business.
Astellas Pharma was down 1.7 percent to ¥5,200 on a reduced full-year prediction and on negative remarks from UBS.
Japan Airlines was 1.4 percent lower to ¥218 on a report that its operating profit was down by half in the first half of its fiscal year and after it said it was cutting its full-year forecast by 24 percent. The air carrier said that its first half profit was affected by slow demand for its domestic flights.
Crude oil prices were higher on Wednesday when new inventory figures showed that distillates stockpiles fell much more than had been anticipated as well as on comments out of Saudi Arabia that the market is still oversupplied, which implies that OPEC is thinking of cutting production yet again.
Inventories of crude oil were up by 400,000 barrels in the week ending November 3, bringing the amount of oil in storage to 334.7 million barrels, much above average for the time of year. Imports of crude oil averaged 9.8 million barrels per day during the week, 306,000 barrels lower than the week before. In addition, even though gasoline stockpiles were down by 600,000 barrels they were still in the upper reaches of average storage for this time of year. Distillate inventories, which include heating oil and diesel fuel, were down by 2.7 million barrels.
Brent crude for December delivery was $1.01 higher to $59.49 in late afternoon trade in London, while December contracts for West Texas Intermediate crude added 96 cents by early afternoon on the New York Mercantile Exchange. December Nymex gasoline gained 4 cents to $1.5740 per gallon, while December Nymex heating oil was 3.7 cents higher to $1.7180 per gallon.
In the metals markets on Wednesday, gold dropped over $3 to $621.00/$621.55 early in the day in New York. Zinc prices were $80 lower to $4,420 per tonne even though they were as high as $4,535 per tonne during the day, a new record. The price decline came even though London Metal Exchange warehouse inventories dropped 1,825 tonnes to only 97,725 tonnes. Lead dropped $25 on the session to $1,715 per tonne despite a climb to $1,752 per tonne earlier. Copper prices were also lower, dropping $240 to $7,130 per tonne.
The US dollar remained close to Tuesday’s levels on Wednesday in the wake of election results that put the Democratic Party in the majority in the United States House of Representatives. Control of the Senate still had not been decided on Wednesday morning due to at least one race, in Virginia, that was too close to call.
Analysts were divided on what the outcome of the election meant. Some said that the change in the balance of power would mean very little to the markets absent any other factors. Others felt that the election results were strongly dollar-negative due to the potential for stalemate in the Iraq situation between the Republican White House and the Democratic House as the Bush administration continues to press its objectives in the face of serious questioning from the House.
At mid-afternoon in New York, the greenback was even against the euro at $1.2770, while it had gained a bare 0.1 percent to ¥117.8 versus the Japanese yen.
Sterling was even in relation to the US currency at $1.9050 and dropped 0.1 percent to the euro, to £0.67.04 as investors waited for the Bank of England to make its next interest rate decision on Thursday. Most analysts believe that a rate hike from the Monetary Policy Committee is a done deal, especially after new data that shows shop prices in October going up at their fastest rate since May 2004.
In other interest rate news, the Australian dollar dropped 0.6 percent versus the greenback to $0.7680 after the Reserve Bank of Australia raised interest rates there by 25 basis points to 6.25 percent, as it had been expected to do.
The Chinese renminbi added 0.1 percent to Rmb7.8719 to the dollar, a new high since its revaluation last year.
