* Euro hits day's low after weak Portugal auction results
* Steady prices, low volume in U.S. Treasury trading
* Oil slips on increase in crude inventories
* Investors await Bernanke for monetary policy view
(Adds opening of U.S. markets, changes byline, dateline,
previous LONDON)
By Herbert Lash
NEW YORK, July 21 (Reuters) - Global stocks and the dollar
rose on Wednesday after Apple's robust profits raised hopes
the recovery remains intact, but uncertainty over planned
testimony by Federal Reserve Chairman Ben Bernanke unsettled
investors.
Optimism that began late on Tuesday after Apple Inc
<AAPL.O> announced an unusually upbeat revenue forecast spread
later to Asia and Europe. A raft of U.S. earnings also beat
Wall Street's expectations, adding to sentiment.
But Wall Street traded moderately lower as earnings
enthusiasm was tempered by caution ahead of Bernanke's
afternoon testimony in Congress.
MSCI's all-country world equity index <.MIWD00000PUS>
pared gains to trade 0.2 percent higher.
Tuesday's late rally on Wall Street was due in part to
speculation Bernanke would try to spur lending by eliminating
interest paid on excess bank reserves held at the Fed.
"Yesterday, the rumors were the rally was sparked ahead of
what Bernanke potentially might say. Now we've got some
apprehension here," said Ryan Detrick, senior technical
strategist at Schaeffer's Investment Research in Cincinnati.
"So there is the 'What is Bernanke going to say? Is he
going to try and keep the pedal to the metal in terms of
interest rates low, add a new wrinkle?'"
The unease took some of the glow off results from Morgan
Stanley <MS.N>, BlackRock Inc <BLK.N>, Abbott Laboratories Inc
<ABT.N>, EMC Corp <EMC.N> and Coca-Cola Co <KO.N>, all of
which beat analysts' expectations for quarterly earnings.
The Dow Jones industrial average <> was down 10.82
points, or 0.11 percent, at 10,219.14. The Standard & Poor's
500 Index <.SPX> was down 2.94 points, or 0.27 percent, at
1,080.54. The Nasdaq Composite Index <> was down 11.92
points, or 0.54 percent, at 2,210.57.
The euro fell against the dollar as tepid demand at a
Portuguese debt sale underscored fears about Europe's banks
days before the European Union was due to reveal which ones
need to raise more capital. []
The dollar softened against other major currencies,
though, as markets braced for Bernanke to reassure Congress
that the U.S. central bank has the tools to reinvigorate an
increasingly sluggish U.S. economy.
The euro has had a good run against the dollar in recent
weeks, rising to a 10-week high above $1.30 on Tuesday as
investors started betting most of the 91 European banks being
examined would pass their stress tests. []
The dollar was up against a basket of major currencies,
with the U.S. Dollar Index <.DXY> up 0.42 percent at 83.096.
The euro <EUR=> was down 0.61 percent at $1.2805, and
against the yen, the dollar <JPY=> was down 0.37 percent at
87.18.
"The euro is correcting lower as a result of the
Portuguese auction," said Michael Hewson, currency strategist
at CMC Markets. "It doesn't take much to sow seeds of doubt in
the euro."
U.S. crude oil <CLc1> slipped 43 cents, or 0.55 percent,
to $77.15 per barrel after weekly government data showed a
surprising increase in U.S. crude oil stockpiles after
widespread predictions of a drawdown. []
The U.S. Energy Information Administration said commercial
crude inventories rose 360,000 barrels in the week to July 16
to 353.46 million barrels, confounding an average forecast for
a fall of 1.4 million barrels.
London ICE Brent futures <LCOc1> slid 60 cents to $75.62.
Prices for U.S. government debt rose ahead of Bernanke's
testimony before the Senate Banking Committee on the economy
and monetary policy. []
The benchmark 10-year U.S. Treasury note <US10YT=RR> was
up 5/32 in price to yield 2.94 percent.
Asian stocks rose on Apple's strong earnings and on hopes
that China may roll back policy tightening measures later this
year. The MSCI index of Asia Pacific ex-Japan stocks
<.MIAPJ0000PUS> rose 0.7 percent, Japan's Nikkei average
<> inched down 0.2 percent.
(Reporting by Chuck Mikolajczak, Steven C. Johnson and Emily
Flitter in New York and David Turner and Joe Brock in London;
Writing by Herbert Lash; Editing by Padraic Cassidy and Jan
Paschal)
