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(MENAFN - Arab News) Global stocks edged higher on Friday, despite mixed signals on the US economy, as strong euro zone economic data dragged the US dollar to a one-month low against the euro and risk aversion eased a bit.
European shares ended at their highest level in almost two months as data showing a rise in US retail sales in February surprised investors who had expected a decline because of inclement weather during the month.
Earlier news that euro-zone industrial output in January recorded its biggest monthly gain on record, while figures for December were revised sharply upward, gave European equity markets an initial boost and at first lifted US stocks.
But US stocks trimmed those gains to trade little changed after a weak reading of US consumer sentiment in early March showed Americans were less positive about the job outlook.
"There are some encouraging signs," said Luc Van Hecka, chief economist at KBC Securities.
"But there is some legitimate caution," he said. "Governments have done well in avoiding a depression, but they are left with quite severe budget deficits. Clearly it's not going to be an easy way so there are limits and doubts." MSCI's all-country index gained almost 0.4 percent and the FTSEurofirst 300 index of top European shares ended 0.3 percent higher at 1.058.97 points, its highest close since Jan. 19.
US stocks traded near break-even. The Dow Jones Industrial Average was down 4.15 points, or 0.04 percent, at 10,607.69. The Standard & Poor's 500 Index was down 0.74 of a point, or 0.06 percent, at 1,149.50. The Nasdaq Composite Index was down 2.65 points, or 0.11 percent, at 2,365.81.
The euro gained 1 percent against the dollar at one point and was up 0.70 percent at $1.3754.
Sterling climbed 1 percent against the dollar to a session high as investors who had bet against the British pound were forced to buy to prevent losses.
The pound was last up 0.9 percent at 1.5200 after going as high as 1.5217.
US Treasury debt prices rose as the mixed readings on US economic data raised doubts over the pace of the economic recovery in advance of next week's Federal Reserve policy meeting.
The weaker US sentiment figure revived a safety bid for bonds, analysts said.
"In general, when you get mixed data in this environment, you still have a lot of dollars willing to commit to Treasuries," said Russ Certo, co-head of the rates group at Broadpoint Gleacher in New York.
Bonds initially fell after investors saw growth in retail sales, but they rebounded from session lows after the consumer sentiment survey unexpectedly fell, kindling fears the spending pick-up would fade and slow the recovery.
The benchmark 10-year US Treasury note was up 10/32 in price to yield 3.70 percent.
In Europe, 10-year euro zone government bonds were the main beneficiaries of weaker Wall Street shares and the below-forecast US consumer sentiment survey. Concern over Greece's debt took a back seat.
The 10-year German bond yield, which moves inversely to price, was down 0.7 basis points at 3.155 percent.
Meanwhile, oil prices fell below $81 on Friday after peaking above $83 following mixed economic reports that kept investor on edge about the outlook for improving energy demand.
By early afternoon, benchmark crude for April delivery dipped $1.16 to $80.95 a barrel on the New York Mercantile Exchange. Prices jumped as high as $83.16 earlier, after a surprise increase in February retail sales and a brighter outlook for world energy demand from the International Energy Agency. Crude has risen from $69.59 a barrel on Feb. 5 as economic data pointed to slow but steady US economic growth. This past week oil prices have settled between $81.49 to just over $82.
In other Nymex trading in April contracts, heating oil fell 3.10 cents to $2.0840 a gallon, and gasoline lost 2.66 cents at $2.2454 a gallon. Natural gas gave up 1.4 cents at $4.422 per 1,000 cubic feet. Earlier it hit a 52-week low of $4.412 per 1,000 cubic feet.
In London, Brent crude fell $1.19 to $79.09 on the ICE futures exchange.
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