* Dollar index up, recovers from 4-month low
* Yen extends gains after HSBC results, high-yielders fall
* Dlr, euro technical levels crack
(Adds quotes, updates prices, changes byline)
By Jamie McGeever
LONDON, May 11 (Reuters) - The dollar rebounded from a
four-month low and the yen rose broadly on Monday as investors
cashed in on last week's rally in riskier assets such as stocks,
boosting the appeal of so-called safer haven currencies.
Commodities fell and bank stocks underperformed broader
indices, with HSBC <HSBA.L> leading the way after it reported
first quarter profits were swelled by record results in its
investment bank, but would have been down without accounting
gains on its debt [].
The yen was the main gainer, while the dollar shrugged off
growing technical weakness to recover from multi-month lows
struck earlier in the global session on hopes the worst of the
economic slump and financial crisis is over.
But with the economic outlook still far from certain,
investors were reluctant to push riskier assets even higher and
instead booked profits, particularly in banking shares and oil.
"The market's seeing a pullback from the overextended risk
rally that occurred last week," said Lauren Rosborough, currency
strategist at Westpac.
"A lack of significant data and a confluence of views on
recent bank stress test results and U.S. labour market data has
stalled the recent trend to sell the dollar," she said.
Last Friday the dollar broke below some key technical
support levels on daily and weekly charts on an index basis and
against the euro, culminating in fresh lows early on Monday.
But it retraced as the European session progressed, and at
1140 GMT the dollar index, a measure of the dollar's value
versus a basket of six major currencies, was up 0.3
percent on the day at 82.721 <.DXY>.
Earlier on Monday it dipped to 82.292, its lowest since
early January, after breaking support from its 200-day moving
average on Friday.
The euro fell 0.9 percent to 132.94 yen <EURJPY=R> after
briefly hitting a one-month high at 134.81 earlier, while the
dollar was 0.7 percent lower at 97.86 yen <JPY=>.
The euro was down 0.5 percent at $1.3583 <EUR=>, having
earlier hit a seven-week high at $1.3670 on trading platform
EBS.
The euro had climbed 1.7 percent on Friday, helped by a
break through its 200-day moving average, a key technical
resistance on the charts.
RISK PARED BACK
European shares <> were 1 percent lower, while U.S.
stock futures <SPc1><DJc1> pointed to a lower start on Wall
Street.
"U.S. stock futures are off and the market has run with that
a little bit," said Steven Barrow, head of G10 FX Research at
Standard Bank.
"You look at the risk positions and they've been pared back
a bit but a lot of the currencies have had a good run, so it's a
bit of a pullback, the question is whether it's a pullback to
buy in to or something more sinister."
Analysts said with several risk events out of the way such
as stress tests for U.S. banks and jobs data, investors were
generally more confident, although there was little in the way
of near-term events to keep up that momentum.
Standard Bank's Barrow said that there currently wasn't
enough momentum to see a significant break higher for the euro
just now even if it did get above the $1.37/1.38 area, and that
a further improvement in sentiment would be needed.
"As markets improve then the performance of investors, and
hedge funds in particular, will improve and encourage them to
feel redemptions could be diminishing and they can put more risk
to work, getting out of dollars and investing overseas," he
said.
The New Zealand dollar was down 0.1 percent on the day at
$0.6026, having earlier climbed to its highest in six months
above $0.6100 <NZD=D4> and the Australian dollar was down 1
percent at $0.7622 <AUD=> after hitting a seven-month peak in
early Asian trade at $0.7714 <AUD=D4>.
