* MSCI world equity index rebounds slightly as Wall Street
* Dollar dips but remains above four-week low
* Oil drops below $110 as Syrian tensions ease further
By Herbert Lash
NEW YORK, Sept 17 The dollar retreated and
global equity markets were mostly flat on Tuesday even though
Wall Street advanced, as investors took positions before this
week's Federal Reserve policy meeting that is expected to start
the rolling back of its stimulus program.
The euro rallied against the dollar after a
better-than-expected reading of a German sentiment survey, while
European shares edged lower, pressured by weakness in the auto
sector following a decline in demand last month.
But Wall Street rose, leading a measure of global equity
markets to rebound, after data on U.S. consumer prices added to
sentiment that the Fed will start trimming its bond buying at
the end of its two-day meeting, which begins on Tuesday.
"It seems like now the market is believing that tapering
will be very well managed by Bernanke, that he knows exactly
what the market is expecting and that he's not going to
disappoint," said Jack De Gan, principal and senior advisor at
Harbor Advisory in Portsmouth, New Hampshire, referring to Fed
Chairman Ben Bernanke.
U.S. consumer prices barely rose in August. However, gains
in rents and medical care costs pointed to a stabilization in
underlying inflation that could allow the Fed to begin to scale
back its $85 billion a month in bond purchases.
The Labor Department said its Consumer Price Index edged up
0.1 percent last month after rising 0.2 percent in July. In the
12 months through August, the increase in the CPI slowed to 1.5
percent after advancing 2.0 percent in July.
Economists had expected consumer prices to rise 0.2 percent
last month and increase 1.6 percent from a year-ago.
The euro was last up 0.08 percent at $1.3343. The
dollar was down 0.07 percent versus a basket of currencies at
81.242 and was last up 0.28 percent at 99.34 yen.
MSCI's all-country world equity index rose
0.05 percent, lifted by gains in U.S. stocks, in particular a
1.5 percent rise to $457.05 in shares of Apple Inc.
The Dow Jones industrial average was up 52.65 points,
or 0.34 percent, at 15,547.43. The Standard & Poor's 500 Index
was up 6.22 points, or 0.37 percent, at 1,703.82. The
Nasdaq Composite Index was up 15.91 points, or 0.43
percent, at 3,733.76.
Europe's FTSEurofirst 300 index of leading European
shares was down 0.2 percent at 1,255.93.
Brent crude fell below $109 a barrel as a deal averting any
imminent U.S. attack on Syria calmed fears of a disruption to
Middle East oil supplies and after output resumed at a large
oilfield in western Libya.
Brent crude for delivery in November fell $1.44 a
barrel to a near-one-month low of $108.63. U.S. crude for
October delivery was down 72 cents at $105.87 a barrel.
Longer-dated U.S. Treasuries prices turned lower, erasing
earlier gains, as higher Wall Street stock prices and weaker
German Bunds reduced initial bids for U.S. government debt.
Benchmark 10-year Treasury notes were flat in
price to yield 2.8625 percent.
Safe-haven Bunds fell after data showed the ZEW German
economic sentiment survey for September rose to 49.6 from 42.0
in August, significantly above the 46.0 consensus forecast.
Bund futures were last 49 ticks lower on the day at