The US dollar racked up losses as it slid against all of the major currencies, with investors turning bearish against the greenback as oil prices surged above $122 a barrel. As a result, the commodity currencies picked up the most gains against the US dollar, with the Canadian dollar taking the biggest bite out of the greenback as the currency pair traded in the 1.002 range. On the other side of the spectrum, the low yielding Swiss franc and Yen gained as well as the pairs fell to trade at 1.051 and 104.7, respectively. Against the European currencies, the US dollar failed to hold its ground ahead of the rate decision by the Bank of England and the European Central Bank later this week. As a result, the Euro advanced to 1.553 while the British Pound rose to 1.973, with market participants raising bets that both the central banks will opt to hold key rates steady at its current level on Thursday.
The stock markets posted early morning losses as UBS announced an additional 5,500 in layoffs, but retraced the losses as Fannie Mae disclosed plans to lower capital restrictions as the firm seeks to raise a target of $6B in excess capital. As a result, the DJIA rose 51.29 points to 13,020.83 points, with Chevron leading the advancers. The broader S&P500 fetched 10.77 points to hold off at 1,418.26 points, with 190 stocks hitting a new 52 week high.
Demands for US Treasuries wavered as the stock markets picked up gains late in the session, with short-term bond prices inching higher amid a decline in long-term bonds. As a result, the benchmark 10-Year yield rose to 3.924 percent from 3.869 percent, while the 2-Year yield declined to 2.393 percent from 2.421 percent.
Looking ahead, the MBA Mortgage Application index will kick off the morning at 11:00GMT, with the Non-Farm Productivity index scheduled to follow at 12:30 GMT. The main event risks for the day will be the Pending Home Sales index which will be released at 14:00 GMT, with the Consumer Credit index ending the slew of fresh economic data at 19:00 GMT.
