* Dollar recovers from Friday losses
* Euro on back foot as finance ministers meet
* Stocks underpinned by Bernanke remarks
* Oil, commodities cling on to gains
By Mike Peacock
LONDON, Dec 6 (Reuters) - The dollar recouped some losses on
Monday, having a taken a knock after the U.S. Federal Reserve
said it was open to injecting more funds into the economy, while
the euro weakened and world shares were flat.
Fed Chairman Ben Bernanke said on Sunday the central bank
could end up buying more than the $600 billion in U.S.
government bonds it has committed to purchase, if the economy
fails to respond. []
European shares were flat <>, supported by the belief
that the Fed would do what it took to keep the U.S. economic
recovery ticking along but still concerned about the spreading
euro zone debt crisis.
"Markets have a clear message from the (U.S.) policymakers
that they are in the business to ensure a sustained recovery,"
Mike Lenhoff, chief strategist at Brewin Dolphin, said.
The MSCI world equity index <.MIWD00000PUS> was down 0.1
percent at 321.78. Japan's Nikkei <> closed the day down
0.1 percent or 11.09 points at 10,167.23.
The prospect, following weak U.S. jobless figures, of more
money sloshing around the U.S. economy had taken its toll on the
dollar, but having shed more than 1 percent against a basket of
currencies on Friday, it had scope for a bounce.
The dollar index <.DXY> was up 0.32 percent at 79.628, with
the greenback pulling away from a three-week low against the yen
<JPY=>.
"Friday's moves were so rapid that it is natural to have a
bit of position unwinding," said Keiji Matsumoto, strategist at
Nikko Cordial Securities. "There's also a feeling that there
could be more bad news from the euro zone."
EURO ZONE TROUBLES
The euro, having climbed 1.5 percent on Friday, beat a
retreat to around 1.3305, with Europe's spreading debt crisis
the dominant driver ahead of a euro zone finance ministers'
meeting. []
Peripheral bond yields -- such as Spain and Portugal --
nudged wider after being kept in check last week by European
Central Bank bond-buying, which traders said had risen although
not with the major acceleration some had been expecting.
The Eurogroup of euro zone finance ministers meet on Monday
after an 85 billion euro aid package for Ireland failed to calm
financial markets.
An International Monetary Fund report, to be delivered to
the meeting in Brussels, will say the euro zone should increase
the size of its 750 billion euro rescue fund and the European
Central Bank should boost its bond-buying markedly.
[]
"There is still a lot of uncertainty around the outcome of
the Eurogroup meeting and what further help for the euro zone
periphery will look like," said RBC Capital Markets' rate
strategist Norbert Aul.
At 0930 GMT, December Bund futures <FGBLZ0> were 33 ticks
higher at 126.53 with 10-year yields <DE10YT=TWEB> down 3 bps at
2.832 percent. []
Asian shares generally fared better than those in Europe.
MSCI's gauge of Asian stocks excluding Japan <.MIAPJ0000PUS>
rose to highs not seen since Nov. 15. It was last up 0.35
percent at 467.17, extending last week's 3.9 percent rally.
Australia's S&P/ASX 200 index <> slipped 0.1 percent
but investors snapped up shares in Africa-focused miner
Riversdale Mining <RIV.AX>, after global miner Rio Tinto
<RIO.AX> made a $3.5 billion bid approach. Riversdale shares
surged 12 percent. []
Higher metal prices helped support commodity currencies such
as the Australian dollar<AUD=D4>, which traded around $0.99.
Copper, which notched its biggest weekly gain in four months
on Friday, edged up 0.4 percent to $8,760 a tonne, while U.S.
crude <CLc1> edged up to $89.28 a barrel, having reached a fresh
25-month high at $89.60.
(Editing by Catherine Evans)
