Published: Mon, May 22, 2017
Economy | By Melissa Porter

Softer dollar may be stock silver lining amid Washington drama

Softer dollar may be stock silver lining amid Washington drama

USA crude rose 2.15 percent to $50.41 per barrel and Brent was last at $53.71, up 2.29 percent on the day.

NEW YORK, May 19 (Reuters) - The U.S. dollar fell and was poised for its worst week in more than a year while world stock markets edged up on Friday amid some calm following declines earlier in the week spurred by uncertainty relating to Donald Trump's U.S. presidency. The 10-year Treasury note all but erased an advance, while the dollar held its worst slide since March.

The U.S. dollar fell 0.8 percent against a basket of currencies and was down about 2.1 percent for the week, its largest weekly drop since April 2016.

- The Stoxx Europe 600 index rose 0.6 percent, paring its weekly loss to 1.1 percent.

Brazilian markets cratered on Thursday, with stocks down almost 9 percent and the real 8 percent - the currency's biggest fall since the 1999 devaluation and crisis, although it looked steadier ahead of the start of local trading.

The euro was little changed at $1.11 on Friday. Sterling was 0.1 percent higher at 85.77 pence per euro. It peaked to hit session high at 111.65 and made session lows at 111.02 levels.

The UK's benchmark FTSE 100 closed up by 0.4 percent, FTSEurofirst 300 ended the day up by 0.51 percent, Germany's Dax ended up 0.4, and France's CAC finished the day up by 0.6 percent.

U.S. President Donald Trump's dismissal of Comey last week set off a political firestorm that led to Wall Street's biggest sell-off in over eight months on Wednesday after media reported that Comey had written a memo stating that Trump had asked him to drop a probe into his former national security advisor's Russian connections.

"The market is fearful now that the cuts in regulation, the tax incentives, etc., just won't be forthcoming because the administration will be so busy fire-fighting scandals, it won't be able to push through any of its promises", said Rabobank currency strategist Jane Foley, in London.

The Dow Jones Industrial Average was up 115.62 points, or 0.56 percent, AT 20,778.64, the S&P 500 gained 17.23 points, or 0.73 percent, to 2,382.95 and the Nasdaq Composite added 42.85 points, or 0.71 percent, to 6,097.98.

It slumped 2 percent on Thursday, its biggest one-day loss since November. The US dollar decreased to 0.9732 Swiss franc from 0.9806 Swiss franc, and it fell to 1.3516 Canadian dollars from 1.3616 Canadian dollars.

"People are still wary of geopolitical risks and not selling the safe-haven asset yet", said Brian Lan, managing director at gold dealer GoldSilver Central in Singapore. Spot gold was flat at $1,259.99 per ounce by 0055 GMT, after earlier touching its strongest since May 1 at $1,263.02.

Brazil's benchmark Bovespa stock index was last up 2.8 percent.

Oil prices rose on Friday, closing out a second week of gains on growing expectations that OPEC and other producing countries will agree next week to extend output cuts. US benchmark crude oil rose 98 cents to $50.33, the highest close since April 19.

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