REFILE-GLOBAL MARKETS-Euro slides, Bernanke underpins stocks

                                
 (Refiles to add dropped letter 's' in headline)
                                
 
                                
 * 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 euro slid on Monday with
concerns about weaker European economies undimmed, while shares
were flat as euro zone worries were offset by the possibility of
more money being injected into the U.S. economy.
                                
 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
failed to respond. [ID:nN05271909]
                                
 European shares edged higher <.FTEU3>, supported by the
belief the Fed would do what it took to keep the U.S. economic
recovery ticking along but still fearful of the euro zone debt
crisis spreading.
                                
 U.S. stock index futures pointed to a mixed open on Wall
Street, following strong gains last week. <SPc1><DJc1>
                                
 "The market is looking a bit tentative. We are looking
towards the euro zone finance ministers meeting to see how much
they are going to increase the safety net," said Micky
Mahbubani, senior sales trader at IG Index.
                                
 "But, we have not seen a major sell off yet as Bernanke's
comments have been supportive. If the outcome of the meeting is
not as good as expected than I expect to see a sell off."
                                
 
                                
 EURO IN RETREAT BEFORE KEY MEETING
                                
 The euro, having climbed 1.5 percent on Friday, beat a
retreat to around 1.3300 ahead of a euro zone finance ministers'
meeting later in the day that will consider next policy options
after an 85 billion euro aid package for Ireland failed to calm
markets. [FRX/]
                                
 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.
[ID:nLDE6B40EJ]
                                
 But whether they will act is far from certain.
                                
 "The crisis will probably get worse before anything is done
and (the Eurogroup meeting) could be another missed
opportunity," said James Nixon, chief European economist at
Societe Generale.
                                
 Peripheral bond yields were kept in check last week by
European Central Bank bond buying, which it increased but not
dramatically so. Far more than that is likely to be needed.
                                
 "The ECB has bought some time by increasing its bond
purchases but unless they are prepared to do that every day,
it's like Canute -- the tide will continue to come in," Nixon
said.
                                
 Portuguese 10-year bond yields <PT10YT=TWEB> rose almost 13
basis points by 1200 GMT, with equivalent Spanish and Italian
yields up around 8 bps. December Bund futures <FGBLZ0> were 26
ticks higher on the day. [GVD/EUR]
                                
 The prospect, following weak U.S. jobless data, of more
money from the Fed 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 bounced.
                                
 The dollar index <.DXY> was up 0.45 percent at 79.74 by 1200
GMT.
                                
 "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."
                                
 Oil eased from a 26-month high near $90 as the dollar
strengthened [O/R] while the MSCI world equity index
<.MIWD00000PUS> was down 0.2 percent at 321.43, with Asian
shares as steady as those in Europe. <.MIAPJ0000PUS>
                                
 Australia's S&P/ASX 200 index <.AXJO> 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. [ID:nnL3E6N600F]
                                
 Firm metal prices helped support commodity currencies such
as the Australian dollar <AUD=D4>, which traded around $0.99.
                                
 Three-month copper on the London Metal Exchange <CMCU3>
traded at $8,725 a tonne at 1123 GMT, within reach of its record
high of $8,966 reached on Nov. 11. [ID:nLDE6B510E]
 (Editing by Catherine Evans)