* US dollar rebounds after slumping to 15-year low vs yen
* Oil slips after earlier 5-month high on weak dollar
* Treasuries eke gains on uncertain payrolls report
* Global stocks slip on dollar despite Fed easing view
(Adds close of European markets)
By Herbert Lash
NEW YORK, Oct 7 (Reuters) - The U.S. dollar rebounded after
slipping to a 15-year low versus the Japanese yen and commodity
prices erased gains that had pushed gold to yet a new high on
Thursday as traders bet momentum had swung too far, too fast.
Oil slipped from a five-month high above $84 a barrel,
copper tumbled and gold, on course for its largest one-day
slide in a month, extended losses as the dollar strengthened.
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The dollar slumped to an all-time low against the Swiss
franc while the Australian dollar surged to a 27-year high
against the U.S. currency, driven by expectations the Federal
Reserve will boost money supply to help the anemic economy.
The Bank of England and the European Central Bank both
stood pat on their monetary policies, reinforcing the notion
the Fed is closer to another round of quantitative easing than
other central banks, a move that would knock the dollar lower.
The dollar <JPY=> fell below 82.87 to the yen, about the
level that led the Bank of Japan to intervene in markets for
the first time in six years on Sept. 15, while the euro rose
above 1.40 <EUR=> before easing some of its gains.
"It's still the same story purely driven by financial
markets, particularly the falling U.S. dollar, which pushes up
commodity prices in dollar-terms across the board," said
Carsten Fritsch, analyst at Commerzbank in Frankfurt.
Stocks swooned late in the day in Europe and Wall Street
also slid as broad selling of the dollar eased and investors
took stock of the currency rout and whether it contradicted
economic fundamentals. []
Investors turned cautious ahead of key U.S. jobless data on
Friday after PepsiCo Inc <PEP.N> trimmed the top end of its
full-year earnings forecast.
The outlook painted a gloomy picture of the U.S. earnings
season, which kicks off with Alcoa Inc <AA.N> after the bell.
The pan-European FTSEurofirst 300 <> index of top
shares closed 0.01 percent lower at 1,070.53 points as miners
tracked metals prices that slid after the dollar's recovery.
"It's been the same story, the dollar goes down, assets are
all inflated -- gold, oil, stocks," said Joe Saluzzi,
co-manager of trading at Themis Trading in Chatham, New
Jersey.
"But in the end stocks are valued by how much money they do
make and earnings are a big deal ... let's see what these guys
actually have," Saluzzi said.
The Dow Jones industrial average <> was down 58.31
points, or 0.53 percent, at 10,909.34. The Standard & Poor's
500 Index <.SPX> was down 7.05 points, or 0.61 percent, at
1,152.92. The Nasdaq Composite Index <> was down 8.77
points, or 0.37 percent, at 2,371.89.
FED EASING STILL EXPECTED
The two-year Treasury note <US2YT=RR> yield marked a record
low, dipping to 0.36 percent from Wednesday's finish near 0.39
percent, knocked down on widespread expectations the Fed will
embark on further stimulus.
Signs of some improvement in the troubled labor market,
from a report showing new U.S. claims for unemployment benefits
fell to a near three-month low last week, did not alter the
view that the Fed will soon roll out a new asset purchasing
program. []
Initial claims for state unemployment benefits dropped
11,000 to a seasonally adjusted 445,000, the lowest since the
week of July 10, the Labor Department said. Analysts polled by
Reuters had forecast claims edging up to 455,000.
"Some people are speculating that tomorrow's (payrolls)
number could be weak enough to validate the speculation about
quantitative easing," said David Coard, head of fixed income
sales and trading at Williams Capital Group in New York.
The dollar rose against a basket of major currencies, with
the U.S. Dollar Index <.DXY> up 0.30 percent at 77.619.
The euro <EUR=> was down 0.47 percent at $1.387. Against
the yen, the dollar <JPY=> was down 0.58 percent at 82.43.
U.S. light sweet crude oil <CLc1> fell $1.60 to $81.63
barrel after earlier hitting $84.43 a barrel.
Spot gold prices <XAU=> fell $17.65 to $1,330.70 an ounce
after hitting an all-time peak of $1,364.60 earlier in the
day.
The MSCI index of Asia Pacific stocks outside Japan was up
0.2 percent <.MIAPJ0000PUS> to the highest since June 2008.
Japan's Nikkei share average <> slipped 0.1 percent but
for the week was still up about 3 percent.
(Reporting by Angela Moon, Nick Olivari and Chris Reese in New
York; Alex Lawler, Amanda Cooper, Alex Lawler, Harro ten Wolde,
Kirsten Donovan, George Matlock and Marie-Louise Gumuchian in
London; Writing by Herbert Lash; Editing by Padraic Cassidy)
