Broker's Notes: Dollar trims gains against yen; oil falls more than 2 per cent

US dollar

US dollar trimmed gains versus the yen on Thursday after data showing the number of people filing new claims for unemployment insurance unexpectedly rose in the latest week. Gold prices extended gains on Thursday after U.S. weekly unemployment data reinforced concern among investors over the outlook for the world's largest economy, prompting a fresh wave of safe-haven buying.

Indian rupee

The Indian rupee bounced back from its lowest in nearly three weeks on Thursday tracking a recovery in local share prices but the euro's fall against the dollar limited the local currency's advance. The partially convertible rupee ended at 46.77/78 per dollar, off an early low of 47.04, which was the lowest since July 26 and about 0.1 percent weaker than Wednesday's close of 46.70/71. The benchmark BSE share index ended flat, erasing intraday losses after dipping as much as 0.9 percent in a choppy session. Foreigners are net buyers of $11.3 billion of domestic equities so far in 2010, adding to last year's record $17.5 billion inflows.

Sterling

Sterling turned lower against the dollar on Thursday, hitting its weakest in nearly two weeks as it tracked falls in the euro after weak euro zone data caused an earlier rally to fizzle out. The euro fell as weak gross domestic product and unemployment data out of Greece, combined with a decline in euro zone industrial production, sparked concerns about the fragility of the euro zone's recovery. Broad dollar gains as investors shunned riskier currencies also weighed on sterling, though the pound hit a six-week high against a broadly weaker euro.

Oil

Oil fell more than 2 per cent towards $76 a barrel on Thursday, heading for a third straight session of losses, on heightened doubts over the outlook for fuel demand in the world's biggest energy consumers. The number of people filing new claims for unemployment insurance in the United States unexpectedly rose in the latest week to its highest level in close to six months, a fresh signal of sluggish economic recovery. China, which rivals the US as the world's biggest oil consumer, showed signs of an abrupt slowdown in economic growth this week, reflected in a drop on Asian stock exchanges on Thursday.

 Source: Richcomm Global, Dubai, www.richcommglobal.com