* Gold posts fresh life-time high, silver at 31-year peak
* U.S. dollar hits 3-year low, charts point to record low
* Strong U.S., European corporate earnings boost equities
* Disappointing U.S. data boost Treasury debt prices
(Updates market action, adds byline)
By Richard Leong
NEW YORK, April 21 (Reuters) - The U.S. dollar tumbled to a
three-year low against major currencies on Thursday and gold
surged to a new high as investors piled into investments that
are less reliant on the U.S. economy.
The negative sentiment on the dollar accelerated this week
on signs of a slowing U.S. economy and Standard & Poor's
warning on Monday that it might take away the United States'
coveted AAA-rating in two years if Washington fails to achieve
a plan to slash its $14 trillion debt load.
"If you look at all these big picture things, there's no
reason to buy dollars right now," said Ronald Simpson, director
of currency research at Action Economics in Tampa, Florida.
Upbeat U.S. and European corporate earnings propelled world
stocks to a 33-month high. Several U.S. bellwether stocks
jumped after strong earnings but many of those companies have
significant sales outside the United States, which is showing
signs of slowing again due to weak job growth and rising oil
prices.
With investor focus shifting to solid U.S. and European
corporate earnings and signs the rest of the world economy is
chugging along, for now the market was overlooking the
sovereign debt problems on both sides of the Atlantic.
This has emboldened investors to pile back into riskier
assets, though some analysts advised caution as worries about
the euro zone debt crisis and problems in the supply chain
following the Japanese earthquake stayed in the background.
With little chance of the Fed raising interest rates this
year, the dollar index <.DXY> was down by 0.47 percent to
74.020 after falling to 73.735, its lowest level since August
2008. Also, light holiday trading volume magnified foreign
central banks' ongoing diversification of their reserves from
the U.S. currency.
Technical charts suggested the index could move towards a
record low of 70.698 hit earlier that year. []
The weak greenback helped push spot gold <XAU=> to another
record high at $1,508.75 an ounce while spot silver <XAG=>
soared to a 31-year high at $46.24 an ounce. []
The rally in precious metals was also seen in worldwide
stock markets.
The MSCI All-Country World Index <.MIWD00000PUS> rose 0.7
percent to a high of 350.44, last seen in July 2008, with Asian
shares leading the way. The MSCI Asia ex-Japan <.MIAPJ0000PUS>
jumped 1.3 percent on a surge in technology stocks.
The FTSEurofirst 300 <> index of top European shares
was up 0.4 percent, while Wall Street stocks <> <.SPX>
<> were 0.3 percent higher. []
Asian stocks rose to their highest level since January 2008
with Japan's Nikkei <> closing up 0.8 percent.
Oil prices in London turned negative after surprisingly
weak data on U.S. jobs and regional manufacturing stoked
worries over energy demand. ICE Brent June crude <LCOM1> was
down 34 cents at $123.51 after rising above $124 a barrel on
the weak dollar and a drop in U.S. stockpiles. []
Thursday's disappointing U.S. economic reports boosted
Treasury prices and reinforced expectations that the U.S.
central bank will pledge to keep interest rates low well into
2012 after its policy meeting next week.
The weaker outlook also reduced investor expectations on
U.S. inflation. The five-year breakeven rate, which is the
yield gap between five-year Treasury Inflation-Protected
Securities and regular five-year government debt, fell to 2.34
percent, more than 0.02 percentage point lower than late
Wednesday.
(Additional reporting by Wanfeng Zhou and Robert Gibbons in
New York; Emelia Sithole-Matarise and Jan Harvey in London,
Editing by Chizu Nomiyama)
