* Euro strikes new two-month low despite Ireland debt rescue
* Portugal and Spain may be in the crosshairs next
* U.S. stock futures up; gold a shade firmer
* Currency, bond investors doubt deal can contain crisis
By Gui Qing Koh
SYDNEY, Nov 29 (Reuters) - Doubts over whether a rescue
deal for debt-soaked Ireland can plug Europe's debt crisis
drove the euro to two-month lows on Monday and trapped Asian
stock markets in choppy trade.
Even though European authorities agreed to lend Ireland 85
billion euros ($115 billion) on Sunday in the hope it would
assure investors that all European nations can repay their
debts, the Asian market was cool to the deal. []
The euro fell to a two-month low of $1.3183 as
investors worried European authorities might not have the
means to rescue all fiscally-poor European nations including
Portugal and especially Spain, whose economy is much bigger
than Ireland's.
"There are still lingering worries about the rest of the
countries, including Portugal and Spain," said Lorraine Tan,
the director of Asian equity research at Standard & Poor's.
"It does raise risk worries and there are less people
willing to take risk at this stage."
The price action in stock and currency markets said as much.
The euro struggled at $1.3224 in mid-day Asian trade, a
good way from a high of $1.3345 struck after the Irish aid was
announced. []
Nervous investors turned instead to the U.S. dollar,
considered a safer asset because it is widely traded. The
dollar index hit a two-month high of 80.652, and rose
against the yen to a two-month peak above 84.18 yen .
The overall cautious tone kept Asian stocks vacillating
between modest gains and losses.
By mid-day, the MSCI Asian stock index outside Japan
was little changed even though U.S. stock
futures were buoyant, with S&P 500 futures <SPc1> up 0.5
percent.
Japan's Nikkei was the region's best performer
with a 0.8 percent rise. But traders noted the market was
thin, suggesting buyers were prudent nonetheless, especially
with tensions on the Korean peninsula still bubbling.
[]
The reaction in the commodity markets were more mixed.
Oil <CLc1> managed to brush aside the firmer dollar to
rise past $84 towards a two-week high as some thought
the Irish deal bode well for energy demand.
Copper prices, an essential ingredient for industrial
work, were steady while iron ore prices hovered at
6-1/2-month peaks. Iron ore is needed to make steel
and is considered a barometer for the state of economic
activity.
Gold, on the other hand, which tends to be in demand when
investors shy away from risk, was a shade firmer at $1,363.19.
(Editing by Kim Coghill)
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