* Below-forecast U.S. jobs data supports dovish Fed
* World equities index hits highest in almost six years
* Brent up on Libya concern, WTI drops on U.S. inventories
By Rodrigo Campos
NEW YORK, Oct 30 A gauge of global shares rose
to its highest in almost six years on Wednesday on expectations
that the Federal Reserve will keep its current stimulus program
intact, while the U.S. dollar edged lower, giving support to
gold and copper prices.
Many traders expect the U.S. central bank to signal later in
the day, at the end of a two-day policy-making meeting, that it
plans to keep in place a stimulus program that has lifted
equities and other risk assets, and boosted Treasury bond prices
while weighing on the U.S. currency.
Spot gold rose the most in a week after soft U.S. jobs data
supported an expectation that the Fed will keep its $85 billion
a month in bond purchases in place, in a bid to spark life into
a lackluster economic recovery.
Data showed U.S. private-sector employers hired the fewest
workers in six months in October, and that tepid domestic demand
kept inflation benign last month, suggesting the economy was
still in need of stimulus.
On Wall Street, the S&P 500 hit a fresh intraday record but
indexes edged lower ahead of the Fed statement on its policy
decision, expected at 2:00 p.m. EDT (1800 GMT).
Analysts warned that any hint that the Fed could trim back
stimulus in the near future could prompt a negative market
reaction, and noted that the recent rally had stretched
valuations to a point that could encourage some profit-taking.
"I don't think anybody expects any surprise coming out of
the Federal Reserve's meeting, everybody is just stepping back
to make sure," said Hugh Johnson, chief investment officer of
Hugh Johnson Advisors LLC in Albany, New York.
The Dow Jones industrial average fell 15.62 points,
or 0.1 percent, to 15,664.73, the S&P 500 lost 3.85
points, or 0.22 percent, to 1,768.1 and the Nasdaq Composite
dropped 13.25 points, or 0.34 percent, to 3,939.088.
Europe's broad FTSEurofirst 300 index reached its
highest since mid-2008, buoyed by earnings, including those of
Volkswagen and clothing retailer Next,
before dipping less than 0.1 percent towards the close.
The MSCI world equity index hit an intraday
level not seen since early 2008 and was last unchanged for the
DOLLAR DIPS WHILE GOLD, COPPER JUMP
Data showing that U.S. private-sector employers added
130,000 jobs in October, below expectations for a rise of
150,000, hurt the U.S. currency. The dollar dipped less than 0.1
percent against a basket of major currencies after
gaining nearly 0.5 percent on Tuesday.
"The private sector jobs data reflects a labor market that
shifted to lower gear in recent months and feeds into forecasts
that the Fed will hold off on tapering until late in the first
quarter of 2014," said Omer Esiner, chief market analyst at
Commonwealth Foreign Exchange in Washington D.C.
Dollar sellers had driven the U.S. currency to nine-month
lows by the end of last week, taking their lead from a steady
decline in U.S. Treasury yields as investors anticipated and
extended the period of Fed bond buying.
The 10-year Treasury note last traded up 9/32 in
price with a yield of 2.4763 percent, near a three-month low of
2.471 percent hit last week.
The euro edged up 0.2 percent to $1.3768 after
dropping the most in three weeks on Tuesday.
Spot gold rose the most in a week, also on expectations the
Fed will keep buying bonds and pressuring the dollar. Gold
was last up 0.8 percent near $1,354 an ounce.
Copper prices jumped 1.3 percent to $7,293 a ton.
Brent crude rose 0.4 percent to $109.44 a barrel as
export disruptions in Libya continue to cut supplies to Europe
and Asia, while the benchmark U.S. contract fell 1.2
percent to $97 a barrel after a bigger-than-expected increase in
inventories in the United States.