* Dollar eases after hitting 14-year highs
* Oil prices jump on signs producers to comply with cuts
* European shares set 11-month high
* U.S. stocks down slightly in afternoon trading
(Adds quote, European shares' close, updates prices)
By Caroline Valetkevitch
NEW YORK, Dec 16 The dollar and U.S. stocks
dipped on Friday, taking a breather after this week's big moves
after the Federal Reserve signaled a faster pace of U.S.
interest rate increases next year.
U.S. Treasury debt yields inched higher, continuing a
weeks-long trend. Markets appeared to be adjusting for what is
expected to be a quiet holiday period for economic data.
"We took direction from the Fed, but over the next couple of
weeks we'll see some more cleaning up of positions heading into
the year-end," said Tom Simons, money market economist at
Jefferies & Co in New York.
Bond yields have surged and the dollar has rallied since
the Fed on Wednesday raised rates for the first time in a year
and its forecasts showed three more rate increases in 2017. The
dollar has since strengthened to almost parity with the euro.
U.S. stocks, which fell on Wednesday following the Fed
meeting but bounced back on Thursday, eased again on Friday and
the S&P 500 was on track for a slight weekly decline.
The Dow Jones industrial average was down 2.85
points, or 0.01 percent, to 19,849.39, the S&P 500 lost
3.68 points, or 0.162686 percent, to 2,258.35 and the Nasdaq
Composite dropped 15.82 points, or 0.29 percent, to
"For the next two weeks, we have somewhat of an aimless
market, where people are getting ready to close the books for
the year," said Mohannad Aama, managing director at Beam Capital
Management in New York.
World stocks as measured by the MSCI world equity index
, which tracks shares in 46 countries, were up
European shares closed up 0.3 percent. Merger and
acquisition speculation around drug maker Actelion and
insurer Generali helped the benchmark index to set an
11-month high earlier in the session.
In the foreign exchange market, the dollar index,
which measures the greenback against a basket of six major
rivals, was last at 102.82, down 0.2 percent. It hit a 14-year
high of 103.560 on Thursday.
In afternoon U.S. trading, 10-year Treasury prices
were down 1/32, yielding 2.584 percent, up from
Thursday's 2.578 percent. On the week, 10-year yields have
gained nearly 13 basis points.
In commodities, a strong dollar and signs of mounting supply
in London Metal Exchange warehouses dragged copper prices lower.
Other industrial metals also slipped.
Benchmark LME copper was down 1.7 percent at $5,633
Oil prices jumped as producers showed signs of adhering to a
global deal to reduce output. Brent crude futures were
trading at $55.20 per barrel, up 2.2 percent, while U.S. crude
was up 1.8 percent at $51.83.
For Reuters new Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Opener=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Additional reporting by Gertrude Chavez-Dreyfuss in New York
and Tanya Agrawal; Editing by James Dalgleish and Nick