Oil prices stay weak as US drilling undermines drive to tighten markets
SINGAPORE, May 29 Oil prices remained weak on Monday as a relentless rise in U.S. drilling undermined an OPEC-led push to tighten supply.
* Dollar index backs off from near three-year high
* MSCI Asia Pacific ex-Japan eases 0.1 percent
By Masayuki Kitano
SINGAPORE, May 21 The dollar nursed losses versus a basket of currencies on Tuesday, having retreated the previous day as traders pared back expectations that U.S. Federal Reserve Chairman Ben Bernanke would hint at tapering bond buying this week.
The market's focus is shifting to Bernanke's testimony to Congress on Wednesday after recent comments by Fed officials fuelled speculation the U.S. central bank may trim its bond purchases sooner than expected.
"Markets remain jittery about the potential for the tapering of asset purchases ahead of Chairman Bernanke's testimony to Congress," analysts at Barclays said in a research note.
The dollar index, which measures the greenback's value against a basket of currencies, edged up 0.2 percent to 83.939 . It dropped 0.6 percent on Monday, retreating from Friday's high of 84.371, its strongest level since July 2010.
Asian shares were mixed in early trading. South Korean equities edged up 0.2 percent after global markets mostly rose on Monday, but Japan's Nikkei index eased 0.1 percent due to a pause in the yen's weakness.
"Profit-taking will be dominant in the Tokyo market today. But the downside will be supported because there are many investors who didn't purchase stocks in the sharp rally who will come into the market," said Takashi Hiroki, chief strategist at Monex Inc.
Against the yen, the dollar edged up 0.3 percent to 102.53 yen but remained below a 4-1/2-year high of 103.32 yen set on Friday.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.1 percent to 483.08.
Global equity markets had mostly pushed higher on Monday, driven up by a flurry of merger and acquisition activity, with MSCI's all-country world equity index touching its highest level since June 2008.
U.S. stocks ended little changed on Monday, but both the U.S. benchmark S&P 500 index and the Dow briefly hit all-time intraday highs.
Gold eased 0.4 percent to $1,388.56, steadying after gaining nearly 3 percent on Monday.
Brent crude held steady at $104.81 a barrel.
May 29 The following table shows rates for Asian currencies against the dollar at 0139 GMT. CURRENCIES VS U.S. DOLLAR Change on the day at 0139 GMT Currency Latest bid Previous day Pct Move Japan yen 111.400 111.31 -0.08 Sing dlr 1.384 1.3815 -0.16 Korean won 1119.900 1120.7 +0
SINGAPORE, May 29 San Francisco Federal Reserve President John Williams said on Monday that medium-term trends in inflation remain "pretty favourable," despite some recent soft U.S. consumer price data.