(Updates prices and indexes)
* Gold hits record high above $1,120, then retreats
* Stocks edge lower, U.S. dollar, Wal-Mart outlook weighs
* Dollar firmer but still near 15-month lows
By Al Yoon
NEW YORK, Nov 12 (Reuters) - Gold retreated from a record
high above $1,120 an ounce on Thursday and global stocks lost
ground as doubts about a lasting economic recovery underpinned
the dollar.
Stocks slumped as the U.S. dollar strengthened against
other currencies, also on technical factors.
The yellow metal <XAU=> pushed to a record high on the
momentum of months of dollar weakness, only to drop $15.35 to
$1,102.40 as the currency recovered. A weak greenback makes
metals priced in dollars less expensive for holders of other
currencies.
Gold's rally from near $800 an ounce in January and the
upcoming yearend also prompted investors to book profits.
"Gold's weakness (on Thursday) was a reflection of
profit-taking after the metal's recent impressive run," said
Peter Buchanan, commodities analyst at CIBC.
The dollar also rose after the euro failed to break through
and hold above the psychologically important 1.50 level. The
euro declined 0.92 percent to $1.4843. The dollar rose 0.56
percent against the Japanese yen, to 90.32 yen.
Prospects that U.S. interest rates will remain at
negligible levels for some time are expected to continue
weighing on the dollar. It rebounded 0.67 percent against a
basket of major currencies on Thursday but is still down nearly
1 percent this month and 14.5 percent since early March.
With a light economic data calendar on Thursday, apart from
strong Australian jobs numbers that boosted the Aussie dollar
to a 15-month high, the broader market consolidated.
In the U.S., the Labor Department reported that first time
claims for unemployment insurance fell to 502,000 in the latest
week from 514,000 in the previous period. That was less than
forecast, but supported the view of a fragile recovery.
STOCKS WEAKER
World stocks weakened, with the MSCI all-country world
index <.MIWD00000PUS> down 0.9 percent and the emerging market
component <.MSCIEF> off 1.36 percent.
The main U.S. indexes drifted lower. The Dow Jones
Industrial Average <> busted a six-session rally as a
stronger dollar hurt commodity shares. Wal-Mart Stores Inc
<WMT.N>, the world's biggest retailer, forecast holiday profit
that could miss Wall Street expectations but its shares still
managed a slight gain.
The Dow Jones average fell 93.79 points, or 0.91 percent,
to 10,197.47. The Standard & Poor's 500 Index <.SPX> declined
11.27 points, or 1.03 percent, to 1,087.24 and the Nasdaq
Composite Index <> edged lower by 17.88 points to
2,149.02.
European shares dropped with the FTSEurofirst 300 <>
index off 0.1 percent to 1,014.91.
Investors globally remained fairly bullish, however, with
signs parts of the world economy are gaining traction.
The Baltic Dry Freight Index <.BADI>, which can be a proxy
for world trade patterns, rose 5.5 percent, pushed up by
freight of iron ore to China.
"A 10th straight increase for the Baltic Dry and a 15-month
high for AUD/USD (Australian/U.S. dollar) do not imply that
sentiment is about to turn over," Kenneth Brough, an economist
at Lloyds TSB, said in a research note.
U.S. Treasuries climbed after the government wrapped up $81
billion of sales this week, and as falling stocks increased the
allure of bonds as a haven from risk.
The yield on the benchmark 10-year Treasury note fell by
0.04 percentage point to 3.44 percent.
