* U.S. consumer confidence lifts U.S. equities
* Yen slumps as bearish bets increase after G20 impasse
* Oil slides under $118 a barrel
By Herbert Lash
NEW YORK, Feb 15 The yen slid against the euro
and dollar on Friday after investors piled on bearish bets,
while U.S. and European stocks edged higher on optimism a surge
in deal-making indicates the market isn't too pricey.
Data that showed manufacturing in New York state expanded in
February for the first time in seven months, boosted by a surge
of new orders, and a survey that reported improved U.S. consumer
sentiment in February also lifted Wall Street.
The Thomson Reuters/University of Michigan's preliminary
reading on the overall index of consumer sentiment rose to 76.3
from 73.8 in January, topping economists' forecasts of 74.8.
"This is unexpected given the increase in gas prices and
payroll taxes. It reflects the recovery in housing prices and
the stock market. This is a welcome event and it should be
embraced by the market," said Jim Awad, managing director at
Zephyr Management in New York.
U.S. and European markets advanced on the report, while a
measure of global equity activity, MSCI's all-country world
index traded almost flat at 356.32.
The Dow Jones industrial average was up 24.61 points,
or 0.18 percent, at 13,998.00. The Standard & Poor's 500 Index
was up 2.24 points, or 0.15 percent, at 1,523.62. The
Nasdaq Composite Index was up 5.55 points, or 0.17
percent, at 3,204.21.
The benchmark S&P 500, up 6.7 percent so far this year, is
facing strong technical resistance near the 1,525 level. But
investors, expecting further advances in the quarter, have held
back from locking in profits and kept stocks from tumbling.
A surge in merger and acquisition activity, with more than
$158 billion in deals announced the first 45 days of the year,
has supported the equity market as it indicates healthy
valuations and a bright economic outlook.
"No retracement of this move is positive; it shows
underlying support for this market," said Art Hogan, managing
director of Lazard Capital Markets in New York.
The flurry of deal-making, highlighted by news on Thursday
that Warren Buffett's Berkshire Hathaway along with
Brazilian private equity group 3G would buy ketchup maker H.J.
Heinz Co, is a tailwind for the market, he said.
"You don't go into M&A if you don't have a positive
outlook," Hogan said.
The dollar extended gains against the yen and pared gains
versus the euro after the report on U.S. consumer sentiment.
Earlier, investors added to bets against the yen amid
uncertainty about a Group of 20 summit in Moscow and questions
about who may be the next leader of Japan's central bank.
G20 officials struggled to find common ground on currency
manipulation at a summit which looked likely to be dominated by
the ultra-loose monetary polices of major developed countries.
A draft communique prepared for G20 finance leaders omits
part of this week's Group of Seven statement declaring fiscal
and monetary policy may only be used for domestic economic aims,
a G20 delegate said on Friday.
The dollar last traded at 93.39 yen, up 0.6 percent
on the day. It had been trading at about 93.34 before the
release of the data.
The euro last traded at $1.3351, down 0.1 percent on
the day. It had been trading at about $1.3348 before the release
of the data, according to Reuters data.
Brent crude oil fell below $117 per barrel on Friday and
was heading for its first weekly loss in five.
Brent futures for April tumbled to a low of $116.28
a barrel, down $1.72, before recovering slightly to around
$116.68. The contract was heading for its first weekly loss
since the first half of January.
U.S. crude shed $1.78 to $95.53 a barrel.
The benchmark 10-year U.S. Treasury note was
down 7/32, with the yield at 2.0225 percent.