RPT-GLOBAL MARKETS-Oil floats near record, dollar's gains capped
(Repeats to additional subscribers)
SINGAPORE, May 7 (Reuters) - Oil prices traded within sight of a record high on Wednesday, capping any gains for the dollar, while resource stocks in Asia rose on sky-high energy and metals prices.
U.S. crude CLc1 was steady at $121.79 a barrel, just off a record high at $122.73 in New York. Prices have doubled in the past year and Goldman Sachs -- which had predicted oil would hit $100 a barrel -- forecasts a potential spike to $200.
The surge in energy prices, agricultural commodities and base metals -- a headache for central banks eager to ward off inflation -- boosted shares in Japanese trading houses, such as Marubeni (8002.T), and Australian miners, such as Rio Tinto (RIO.AX) and BHP Billiton (BHP.AX).
Asian equity markets were also supported by Wall Street's advance on Tuesday after officials of the largest U.S. mortgage financing company Fannie Mae (FNM.N) said they were cautiously optimistic that the worst of the credit crisis had passed even after posting a $2.5 billion quarterly loss. [ID:nN06456763]
Japan's Nikkei average .N225 rose 0.9 percent by the midsession as the country's financial markets reopened after being closed on Monday and Tuesday for national holidays.
MSCI's measure of Asian stocks outside Japan .MIAPJ0000PUS was up 0.2 percent by 0211 GMT, having earlier hit its best level since mid-January. The benchmark is down just under 6 percent so far this year.
But some investors were unconvinced that the worst of the credit crisis was over.
"The financial sector will probably remain perhaps a little under pressure for the time being," said Martin Angel, a dealer at Patersons Securities.
"It's really a case of people second-guessing themselves at the moment. Everyone would like it to be over but these things don't just happen overnight."
Stock indexes in Sydney .AXJO, Seoul , and Singapore .FTSTI added between 0.2-0.4 percent.
In New York on Tuesday, the Dow Jones industrial average .DJI rose 0.4 percent and the Nasdaq Composite Index .IXIC gained 0.8 percent.
DOLLAR EYES OIL
The dollar steadied on Wednesday, having pulled back from a two-month peak against a basket of currencies last week as the jump in oil prices to record peaks was seen as a negative for the U.S. currency.
The U.S. currency typically moves in the opposite direction of oil and gold prices, while the steep cost of crude was also seen prompting Middle East producers to shift some of the dollar-based windfall into other currencies. Continued...
