REFILE-GLOBAL MARKETS-Shares, oil fall on news about US 'fiscal cliff'

Thu Dec 13, 2012 1:21pm EST

* World shares turn lower on news of impasse over budget
talks
    * Government debt falls on unemployment data
    * U.S. dollar recovers against most currencies
    * Oil falls on fears of rising inventories, fiscal cliff
talks

    By Herbert Lash
    NEW YORK, Dec 13 (Reuters) - World shares and commodity
prices slipped on Thursday as investors looked past the Federal
Reserve's announcement of further monetary stimulus and set
their sights on the unresolved showdown over the U.S. "fiscal
cliff."
    Wall Street turned lower after hovering near break-even
after Speaker of the House John Boehner said the "risk remains"
that all tax rates will rise at year's end, suggesting an
impasse remains in budget talks with President Barack Obama.
 
    Analysts said news on U.S. government efforts to avert some
$600 billion in spending cuts and tax hikes due in January would
drive financial markets after the Fed on Wednesday moved to link
its policy to explicit thresholds on unemployment and inflation.
    "There's a lot of confusion. Nobody knows what's going to
happen with the cliff," said Tom Schrader, managing director of
U.S. equity trading at Stifel Nicolaus Capital Markets in
Baltimore.
    Data showing U.S. retail sales rose in November and jobless
claims fell sharply last week were hopeful signs on Thursday for
an economy that appears to have slowed sharply this quarter.
    The news did little to budge the market as investors were
cautious in the face of the ongoing budget negotiations. 
    The Dow Jones industrial average was down 34.33
points, or 0.26 percent, at 13,211.12. The Standard & Poor's 500
Index was down 4.69 points, or 0.33 percent, at 1,423.79.
The Nasdaq Composite Index was down 11.11 points, or
0.37 percent, at 3,002.70.
    MSCI's all-country world equity index, which
had seen seven straight days of gains, fell 0.15 percent at
337.29 points.
    In Europe, the FTSEurofirst 300 index closed down
0.27 percent to a provisional 1,133.89 points, ending a
three-week rally that had pushed prices to 18-month highs. 
    Crude oil prices slipped under $109 a barrel due to rising
U.S. oil stockpiles, while fears that the world's largest
economy might miss a deadline for next year's budget and risk a
recession also kept bulls in check.
    Benchmark Brent crude fell 61 cents to $108.89 a
barrel, but U.S. crude rebounded, rising 14 cents to
$86.91.
    The Thomson Reuters-Jefferies CRB Index, which
tracks 19 commodity markets, was down 0.36 percent at 294.1195.
    U.S. Treasury debt prices eased after data showed claims for
unemployment benefits were lower than expected in the latest
week, which undermined the safe-haven appeal of lower-risk U.S.
government debt.
    The benchmark 10-year U.S. Treasury note was
down 6/32 in price to yield 1.7213 percent.
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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