* Obama says fiscal deal possible within a week
* Spain bond sale disappoints; euro slips from 7-week high
* Shares of Apple tumble 4 pct
* U.S. data shows private sector hiring hit by storm
By Leah Schnurr
NEW YORK, Dec 5 U.S. stocks reversed losses in a
choppy session on Wednesday after President Barack Obama said a
deal to avert the looming fiscal cliff was possible within a
week, while the euro slipped after a disappointing Spanish bond
Investors continued to keenly monitor any progress in talks
to avoid the so-called fiscal cliff of year-end tax hikes and
spending cuts. Obama said an agreement could be reached in a
week if Republicans compromise on taxes.
"Just the idea that we could have some kind of timeline is
enough to eliminate some of the concerns," said Todd
Schoenberger, managing partner at LandColt Capital in New York
"The fiscal cliff is the headline driver, so anything even
slightly positive will move markets."
Economists say the $600 billion in tax hikes and spending
reductions that will start to go into effect at the beginning of
next year could send the economy back into recession if
politicians don't come to an agreement to avoid it.
A 4 percent drop in shares of tech giant Apple constrained
gains, and the Nasdaq fared worse than the other indexes.
The euro fell after hitting a seven-week high against
the dollar in early trading, stung by the disappointing Spanish
bond sale and weak euro zone economic data. The euro was down at
"My theory is that this is the last week of an equity market
rally, and therefore the last week of an euro/dollar rally,"
said Andrew Busch, senior currency strategist at BMO Capital in
Bond markets also reacted poorly to the auction, with
Spanish 10-year yields rising to 5.42 percent after demand for
the sale was below expectations.
Euro zone experts still expect Madrid to request a sovereign
bailout which would pave the way for the European Central Bank
to buy its debt but doubts have started to creep in again
following a drop in tensions and yields in recent weeks.
The Dow Jones industrial average gained 108.60
points, or 0.84 percent, to 13,060.38. The Standard & Poor's 500
Index rose 5.19 points, or 0.37 percent, to 1,412.24. The
Nasdaq Composite Index was off 10.15 points, or 0.34
percent, to 2,986.54.
The FTSEurofirst 300 index added 0.3 percent and,
the MSCI index of world stocks rose 0.4 percent.
A mixed batch of business and retail data showed euro zone
shoppers cut back on spending by the biggest margin in six
months in October, while purchasing manager figures pointed to
another quarter of recession.
"The economic data pretty much confirmed the (euro zone)
economy is still in a very weak state," said Rabobank economist
Elwin de Groot.
In the United States, private payrolls processor ADP
reported that private-sector employers added 118,000 jobs in
November, fewer than expected as Superstorm Sandy took a toll on
hiring, though activity in the service sector continued to
Wednesday's other main economic event in Europe came in
Britain, where finance minister George Osborne warned that
growth will be weaker than expected and that he will have to
break a key debt promise.
Britain's economy was now forecast to grow by only 1.2
percent in 2013, down from the 2 percent rate predicted in