* Euro battered as refinancing crunch nears on Thursday
* U.S. 2-year note yields hit record low on risk aversion
* Gold inches higher as safe-haven buying supports gains
By Herbert Lash and Natsuko Waki
NEW YORK/LONDON, June 29 (Reuters) - World stocks,
commodity prices and the euro tumbled on Tuesday as risk
appetite ebbed over concerns about the repayment of 442 billion
euros ($545.5 billion) to the European Central Bank.
Gold inched higher and U.S. Treasuries rose, pushing
two-year note yields to the lowest on record, as jitters over
the euro zone debt crisis supported safe-haven demand. For
details see: [] []
Yields on the benchmark U.S. 10-year Treasuries <US10YT=RR>
fell below 3 percent for the first time since April 2009 as the
euro hit an all-time low versus the Swiss franc and an
8-1/2-year trough against the yen. []
Investors shunned riskier assets and traders cited
significant U.S. dollar short covering overnight, further
weighing on the euro.
The dollar was up against a basket of major currencies,
with the U.S. Dollar Index <.DXY> up 0.71 percent at 86.26.
The euro <EUR=> was down 0.98 percent at $1.2157.
The risk premium on southern European government bonds over
benchmark German bunds widened and the cost of insuring their
debt against default rose. []
"There is quite a lot of worries about the (U.S.) payrolls,
worries about stress tests of European banks and also the
rollover of ECB's long-term repo operations that will be taking
place in the next couple of days," said Paul Robson, currency
strategist at RBS Global Banking.
European shares slumped, with the FTSEurofirst 300
<> index down 2.8 percent. Shanghai's equities index
<> plunged more than 4 percent and Japan's Nikkei <>
was poised for its worst quarter since 2008.
Banks were among the heaviest decliners as they prepare to
pay back the ECB money that was borrowed a year ago at rock
bottom rates, leaving a potential liquidity shortfall in the
financial system of over 100 billion euros. []
Barclays, BNP Paribas and BBVA were down 3 percent to 4.1
percent.
U.S. stocks extended losses, dropping more than 2 per cent,
after a weak reading of the Conference Board's U.S. consumer
confidence index, which fell in June to 52.9 from a downwardly
revised 62.7 the previous month. []
The CBOE Volatility Index <.VIX> jumped more than 16
percent to a session high of 33.82 on news of the private
business research group's confidence index.
Even though single-family home prices unexpectedly climbed
in April from the previous month, signs of a sustained recovery
have yet to emerge, price indexes from Standard & Poor's/Case
Shiller showed.
The S&P composite index of prices in 20 U.S. metropolitan
areas rose 0.4 percent on a seasonally adjusted basis after a
downwardly revised 0.2 percent drop in March, compared with a
0.1 percent decline forecast in a Reuters survey.
MSCI's all-country world index <.MIWD00000PUS> fell 2.7
percent and its emerging markets index <.MSCIEF> fell. 2.8
percent.
Shortly after 10 a.m., the Dow Jones industrial average
<> was down 224.46 points, or 2.21 percent, at 9,914.06.
The Standard & Poor's 500 Index <.SPX> was down 25.39 points,
or 2.36 percent, at 1,049.18. The Nasdaq Composite Index
<> was down 65.29 points, or 2.94 percent, at 2,155.36.
Oil prices fell more than 3 percent to below $76 per barrel
and copper shed more than 4 percent as concerns about economic
recovery weighed on market sentiment. []
[]
U.S. light sweet crude oil <CLc1> fell $2.64 to $75.61 a
barrel.
ICE Brent <LCOc1> fell $2.47 to $75.12.
Benchmark 10-year U.S. Treasury notes <US10YT=RR> were
trading 14/32 higher in price to yield 2.97 percent. Bond
yields move in inverse relationship to their price.
Against the yen, the dollar <JPY=> was down 0.92 percent at
88.53.
(Additional reporting by Angela Moon, Chris Reese in New York;
Harpreet Bhal, Jan Harvey; Writing by Herbert Lash. Editing by
W Simon (
)
