* World stocks weaken after U.S. data
* Gold rises to record highs on safe-haven bid
* Currency intervention concerns continue
(Updates with U.S. markets' close)
By Manuela Badawy
NEW YORK, Sept 16 (Reuters) - U.S. stocks were little
changed on Thursday as data showed the U.S. economy's recovery
remained halting, while the dollar rose slightly against the
yen a day after Japan's huge intervention to weaken its
currency.
Gold rose to a record high above $1,275 per ounce as
jitters about any further yen selling and broader economic
uncertainty enticed more investors to the safe-haven
commodity.
U.S. government bond prices fell after Philadelphia Federal
Reserve data showed business conditions contracted in the U.S.
Mid-Atlantic region in August, though not as severely as in
July, while U.S. weekly claims for unemployment benefits
dropped to a two-month low but still remained high.
The mildly reassuring data reduced investors' expectations
that the Federal Reserve, which meets on Sept. 21, would renew
quantitative easing in the form of massive debt purchases aimed
at jump-starting the economy.
The latest snapshot of the U.S. labor market and the
regional factory sector data reinforced the view of a slowing
economy but not one on the cusp of slipping into recession or
deflation.
"We are just in the same growth path we were before the
double-dip fears -- that is why the (stock) market is just kind
of stuck, volumes are kind of low, and there is no conviction
one way or the other," said John Canally, investment strategist
and economist for LPL Financial in Boston.
"Jobless claims were good, corporate earnings data not so
good, and that's the tug of war you are in today."
The Dow Jones industrial average <> ended up 22.10
points, or 0.21 percent, at 10,594.83. The Standard & Poor's
500 Index <.SPX> closed down 0.41 point, or 0.04 percent, at
1,124.66. The Nasdaq Composite Index <> rose 1.93 points,
or 0.08 percent, to 2,303.25.
Shares in FedEx Corp <FDX.N> fell 3.7 percent to $82.72
after the company, seen as a proxy for economic demand because
of the wide swath of industries it serves, forecast quarterly
profit below Wall Street's expectations and warned the recovery
may slow. For details, see []
The December futures contract for the Nikkei 225 stock
index <0#NK:> trading in Chicago fell 85 points to 9,565, while
MSCI's All-Country World Index <.MIWD00000PUS> fell 0.3
percent.
The FTSEurofirst 300 <> index of top European shares
ended 0.8 percent lower, its lowest closing level in a week,
after disappointing British retail sales in August, a sign the
UK economy was on a slow growth path.
"Times are difficult because of the combination of high
unemployment, banks not lending yet and governments starting to
implement austerity measures. All these factors are not going
to be resolved overnight," said Franz Weis, a fund manager at
Comgest in Paris.
YEN TALK
Investors were jittery after Wednesday's currency
intervention by Japan, its first in six years, that knocked the
yen from a 15-year high versus the dollar. The Bank of Japan's
money market data showed the yen-selling intervention may have
totaled around 1.76 trillion to 1.86 trillion yen ($20.52
billion to $21.69 billion). []
Adding to investor nerves, Japanese Prime Minister Naoto
Kan pointed to more potential yen selling.
Later in the trading day, the dollar <JPY=> rose 0.15
percent to 85.86 yen from a previous session close of 85.73.
Wednesday's move was designed to protect Japanese exports
from a too-competitive exchange rate and ward off job losses.
But analysts said Japanese authorities may have a hard time
fighting the yen's strength, given narrow yield spreads between
Japanese and U.S. government bonds.
"It is almost inevitable that the Japanese authorities will
have to continue intervention heading into year end with
dollar/yen likely to remain under downward pressure as the U.S.
economy slows and the Fed moves toward renewed monetary
easing," said Lee Hardman, currency economist at The Bank of
Tokyo-Mitsubishi UFJ in London.
The euro rose to its highest in more than a month against
the dollar <EUR=> at $1.3112 and was last trading up 0.56
percent at $1.3077. Against the yen <EURJPY=> it rose to
112.30 after strong demand at a Spanish bond auction reinforced
confidence in Europe's sovereign issues.
Spain sold a combined 4 billion euros in 10-year and
30-year bonds, at the top of its targeted range, attracting
solid demand and lower yields than its last auction in June.
[]
The country was among those most in the limelight during
the sovereign debt crisis earlier this year.
BONDS AND COMMODITIES
The benchmark 10-year U.S. Treasury note <US10YT=RR> was
down 11/32, its yield at 2.7626 percent after the Philadelphia
Fed data on the U.S. Mid-Atlantic region.
The 2-year U.S. Treasury note <US2YT=RR> was unchanged,
yielding 0.4796 percent. The 30-year U.S. Treasury bond
<US30YT=RR> was down 29/32, its yield at 3.9275 percent.
Crude oil <CLc1> fell $1.59, or 2.09 percent, to $74.43 a
barrel ahead of the expected reopening of a North American
pipeline that will restore crude supplies to U.S. refiners.
Spot gold prices <XAU=> rose $5.96, or 0.47 percent, to
$1273.50. Earlier on Thursday it hit a record $1,277.70 an
ounce. U.S. December gold futures also rose to a historic high
<GCZ0>.
(Additional reporting by Wanfeng Zhou and Nick Olivari in New
York and Neal Amstrong in London; Editing by Padraic Cassidy
and Dan Grebler)
