23 February 2005, 09:12  Forex Points: US Market Update

The US dollar fell against the majors in New York as traders reacted to the comments made by the Korean Central Bank and runaway oil prices.
The Korean Central Bank stated that it will diversify its foreign exchange reserves away from the dollars into other currencies. The dollar bulls suffered another blow when oil prices breached psychologically important $50 per barrel level, reaching the highest levels in over four months.
The Conference Board consumer confidence index fell to 104 for February from a revised 105.1 in January, a six month high, as consumers became more cautious about the state of the US economy in the next six months.
The dollar was quoted at 1.3252-55 against the euro, 1.9102-07 versus the British pound and 104.14-18 against the Japanese yen at 23:00 GMT.
Wall Street stocks plummeted as rising crude oil prices and renewed dollar weakness sent the overall market tumbling in the biggest one-day decline since August of 2004.
The Dow Jones Industrial Average fell 1.6 percent to 10,611.13, and the Standard and Poor's 500 index lost 1.5 percent 1,184.22. The NASDAQ Composite shed 1.4 percent to 2,030.32.
Energy stocks gained with Valero Energy, the oil refiner, climbing 1.8 percent to $66.44.
Kerr McGee, the oil and gas producer rose 5.3 percent to $74.20 after Carl Icahn, the billionaire financier announced his plan to invest into the company.
Trading in Winn-Dixie, the grocery store chain was halted after the company declared bankruptcy.
Home Depot, a home improvement chain fell 4.1 percent to $40.28 after its quarterly results did not exceed analyst expectations.
The US pharmaceutical sector came under pressure as Merck declined 4.3 percent, to $31.20 and Pfizer lost 0.8 per cent to $26.59 following the acquisition announcement made by Novartis, which would make the Swiss drug maker the largest generic pharmaceutical manufacturer in the world.
The NYMEX crude oil futures contract for March delivery gained over $2.80 to $51.15 per barrel, surpassing the $50 mark for the first time in over four months. Oil rallied as cold winter weather in both the US and Europe drove demand for heating oil.
COMEX gold futures contract for April delivery rallied $7.40 to $435.80 after the dollar fell against the majors on comments made by the Korean Central Bank.
US treasuries sold off as traders positioned themselves ahead of the consumer price data on speculation that inflation rose for the month of January. The 10 Year US Treasury Note lost 3/16 to 97 11/16 pushing the yield higher by 2 basis points to 4.29 percent. The 10 Year Treasury Note futures contract for March delivery fell .04 to 111-11.

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