U.S. stocks retreat while crude oil rallies, Treasuries advance

Euro Weakens

The euro retreated against 13 of 16 major peers, weakening 0.7 percent to $1.2872, as a meeting between German Chancellor Angela Merkel and Greek Prime Minister Antonis Samaras failed to reassure investors an accord is imminent on Greece’s next aid installment.

The two leaders stood side by side at a press conference as protesters massed outside the Parliament building in a capital on virtual lockdown. Merkel has become the face of austerity in a country suffering a fifth year of recession, which many Greeks blame on German-led conditions attached to emergency loans.

European Yields

European finance ministers met for second day in Luxembourg after yesterday declaring operational the permanent aid fund, the 500 billion-euro European Stability Mechanism.

Ten-year Spanish yields increased 11 basis points to 5.82 percent, while Italian rates were up three points at 5.11 percent.

Of the 24 commodities tracked by the S&P GSCI Index, 15 advanced. Crude rebounded 3.4 percent to $92.39 a barrel as Turkey sent more tanks and missile defense systems to the Syrian border yesterday. Brent oil increased 2.4 percent to $114.50. Brent touched a $23.10 a barrel premium to West Texas Intermediate oil traded in New York, the highest intraday level since Oct. 21, 2011, according to Bloomberg calculations of exchange data, before slipping back to $22.11.

Iranian authorities are still seeking to stabilize the currency market days after a plunge in the value of the rial and protests that have left transactions by exchange houses almost at a halt. The central bank today announced a rate of 25,480 rials to the dollar for trading in the government’s newly opened exchange center, according to the state-run Mehr news agency. Today’s official rate is lower than yesterday’s, which the government had set at 25,550 rials against a dollar.

The Shanghai Composite Index rose 2 percent as investors bet the government will come up with steps to support the market. South African’s rand strengthened 1.4 percent to 8.7723 per dollar, climbing for the first time in five days, after the currency’s decline to the weakest in more than three years yesterday.

Bloomberg News

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