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European stocks give up winning streak
European stocks reversed on Tuesday as volatile commodity prices hit shares, giving up some of the gains won over nine days of robust trading as the Greek debt crisis eased
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uropean stocks reversed on Tuesday as volatile commodity prices hit shares, giving up some of the gains won over nine days of robust trading as the Greek debt crisis eased.
London's benchmark FTSE 100 index lost 0.16 percent to stand at 6,777.95 points in afternoon trading.
Frankfurt's DAX 30 fell 0.61 percent to 11,663.91 points and the CAC 40 in Paris slid 0.23 percent to 5,130.47 points compared with Monday's close.
In foreign exchange, the euro rose to $1.0873 from $1.0824 late in New York on Monday when it had earlier hit a near three-month low point at $1.0809.
The dollar climbed Tuesday to a five-week high against the yen on growing expectations the US Federal Reserve will raise interest rates this year.
"The strong USD continues to weigh on market sentiment adding pressure to most commodity prices," said Myrto Sokou, senior research analyst at Sucden Financial.
A sharp plunge in gold prices to a five-year low shook financial markets Monday.
Traders said massive selling in China, where financial markets have been extremely turbulent generally, was behind the drop.
Oil prices were also retreating, with New York-traded crude falling below $50 a barrel as demand for the dollar-priced commodity takes a hit from a strong US currency, analysts said.
Expectations of more Iranian crude flooding the oversupplied global market within months was also dragging prices down.
Lower commodity prices were pressuring shares in heavyweight miners and oil companies in early deals Tuesday.
"A quieter week on the economic calendar and less news flow from Greece may be easing us into the quieter summer months, however there is still plenty to focus on in the markets, with commodities grabbing plenty of attention," said Craig Erlam, senior market analyst at Oanda trading group.
"Meanwhile, earnings season is also well under way and could prove key in determining whether we will see rate hikes this year and companies attempt to weather the strong dollar storm."
US stocks fell in opening trade Tuesday following disappointing earnings from IBM and United Technologies as the market looked ahead to results from Apple later in the day.
Five minutes into trade, the Dow Jones Industrial Average stood at 17,987.87, down 0.62 percent.
The broad-based S&P 500 shed 0.10 percent to 2,126.16, while the tech-rich Nasdaq Composite Index slipped 0.05 percent to 5,216.16.
"Should the slump in commodities persist and intensify many will ask themselves if this is the precursor to another dip in global growth which consequently could hit stocks too sooner or later," said Markus Huber, senior analyst at brokers Peregrine & Black.
Markets are keeping a close eye on the Fed as it considers its first rate rise since 2006 with the US economy getting back up to speed.
In Europe, Bank of England governor Mark Carney has indicated that Britain's record-low interest rate could also soon start to rise.
The BoE chief last week said he expected the key rate to climb over the next three years from its current level of 0.50 percent -- where it has stood for more than six years to help stimulate growth after the global financial crisis. (ika)(++++)
