Europe's FTSEurofirst 300 <.FTEU3> was up 0.7 percent in early
trading, lifted by energy shares thanks to a sharp rise in crude oil
prices, but will likely notch up its fourth straight weekly decline.
That would be its longest losing streak since October 2014.
The dollar was also 0.7 percent higher against the yen at 109.00 yen
<JPY=>, recovering from its first break below 108.00 since October
2014 the previous day.
"It's been a volatile week, so we're seeing a bit of respite today,"
said Ipek Ozkardeskaya, market strategist at London Capital Group.
"And oil is up by more than 2 percent, which is also a key reason
for the upside in equity indices this morning."
Britain's FTSE 100 <.FTSE> was up 0.6 percent, Germany's DAX <.GDAXI>
rose 0.7 percent, and France's CAC 40 <.FCHI> was up 0.6 percent.
The STOXX Europe Basic Resources <.SXPP> and the Oil and Gas <.SXEP>
indexes were both up around 2 percent, the top two sectoral gainers,
tracking the rise in crude prices.
The FTSEurofirst, DAX and CAC are still down on the week, however,
although Britain's FTSE is on course to eke out a modest gain.
Earlier in Asia MSCI's broadest index of Asia-Pacific shares outside
Japan <.MIAPJ0000PUS> ended flat on the day, closing out the week
down 1.2 percent.
Japan's Nikkei <.N225> erased earlier losses after Finance Minister
Taro Aso said the government would take steps to counter "one-sided"
moves in the yen in either direction.
The yen's <JPY=> strength is regarded as negative for Japan's big
exporting firms, and after earlier falling to near-two-month lows,
the Nikkei ended the session up 0.5 percent, leaving it with losses
of 2.1 percent for the week.
U.S. futures pointed to a rise of around 0.6 percent at the open on
Wall Street <ESc1>. The S&P 500 <.SPX> fell 1.2 percent on Thursday,
its biggest loss since Feb. 23, and is on course for its biggest
weekly decline in two months.
Much of the volatility this week has been fueled by the yen's surge
against the dollar, which caught many market participants off-guard
and fueled speculation Tokyo could intervene in the currency market
to halt the rally.
The dollar rebounded 0.7 percent against the yen on Friday to
109.00, leaving it set for a weekly fall of 2.3 percent. On Thursday
it fell as low as 107.67 yen.
Sharp appreciation of the yen against the dollar is often a warning
sign of broader financial market stress and investor risk aversion,
which has been exacerbated this week by growing uncertainty
surrounding the U.S. economic and policy outlook.
Federal Reserve Chair Janet Yellen, in a conversation with former
Fed chairmen on Thursday, said the U.S. economy is on a solid course
and still on track to warrant further interest rate hikes.
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But many forecasts, including the closely-followed Atlanta Fed
GDPNow tracker, have slashed first quarter GDP estimates to just 0.4
percent, and U.S. interest rate futures still see a less than 20
percent chance of a rate hike in June <0#FF:>.
Next up is New York Fed president Bill Dudley, a dovish and
influential policymaker, who speaks later on Friday.
"A combination of falling U.S. real rates and elevated market
volatility are weighing on the dollar versus the euro and yen," BNP
Paribas currency strategists wrote in a note to clients on Friday.
"New York Fed President Dudley speaks today and could provide
another counterweight to the various Fed presidents advocating
resumption in rate hikes in recent weeks."
The euro <EUR=> was trading at $1.1380, unchanged on the day and
flat on the week, having hit a six-month high of $1.1454 on
The 10-year U.S. Treasuries yield <US10YT=RR> was last up 3 basis
points at 1.72 percent, having fallen to a six-week low of 1.685
percent on Thursday. It has fallen 25 basis points in the last four
In commodities markets, copper <CMCU3> last traded at $4,672 a tonne,
having suffered its biggest fall in more than six months on
Thursday, when it slumped 2.8 percent to a six-week low of $4,631 a
Oil prices rose on Friday after firm economic indicators from the
U.S. and Germany implied support for fuel demand, but analysts
warned another downturn could be on the way due to ongoing
Global benchmark Brent crude futures <LCOc1> climbed 3 percent to
$40.63 per barrel, and was set for an increase of 5 percent on the
week. U.S. crude <CLc1> advanced 3.4 percent to $38.55, also on
track for a 5 percent weekly gain.
(Reporting by Jamie McGeever; Editing by Toby Chopra)
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