Oil surged to almost $72 a barrel on Wednesday after a surprise drop in
U.S. inventories, helping U.S. stocks slide as investors worried higher crude
prices may fuel inflation and hamper a recovery.

The U.S. dollar rose against the euro and the yen after the government sold
$19 billion in 10-year notes, easing fears about the U.S. ability to finance a
ballooning budget deficit.

But U.S. government debt prices fell, sending benchmark yields to an
eight-month high of 4.0 percent after the auction heightened bond market
concerns about the deficit.

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MARKET REPORTS:
> GLOBAL MARKETS-Oil up on lower inventories, stocks down [ID:nN10371787]
> MONEY MARKETS-Dollar rates slip, swap spreads widen [ID:nN10458683]
> EMERGING MARKETS-Stocks, bonds edge up aided by oil rise [ID:nN10631860]
> COMMODITIES-Oil tops $71, copper off 8-month peak [ID:nLA690257]
MAIN ECONOMIC AND FINANCIAL NEWS DRIVING GLOBAL MARKETS
> Mounting deficits spark jitters about US economy [ID:nN10640359]
> Citigroup begins $58 bln stock swap [ID:nN10429382]
> US names "pay czar" for bailed out banks [ID:nN10272750]
> Fiat closes Chrysler deal, new management named [ID:nLA433874]
> Fed report shows losses on Bear Stearns, AIG holdings [ID:nN10446182]
> US mortgage demand withers as loan rates rise [ID:nN10429234]
> US April trade gap widens on weaker exports [ID:nN10431427]
> Canada posts trade deficit in April, house prices fall [ID:nN10372960]
> UK industrial output rises in April for first time in a year [ID:nLA546449]
> French industrial output falls sharply in April [ID:nLA592557]
> ECB sees further pain for financial sector [ID:nLA432395]
> Russia to cut holdings of US Treasuries [ID:nLA1052951]
> Swedish central bank takes ECB loans, banks pass stress test [ID:nLA498286]
> Latvia gets IMF support for currency peg, eyes loans [ID:nLA160441]
ANALYSIS RELATED TO THE GLOBAL ECONOMIC CRISIS
> Art of the possible tempers Obama financial reforms [ID:nN10646795]
> Risk assets hitting speed bumps after rally [ID:nL8698035]
> Commodity price rises create bubble concerns [ID:nN08326945]
> FED FOCUS-Federal Reserve to bond market: "We get it" [ID:nN05279806]
> US Treasury bloodbath soaks top fund managers [ID:nN03523331]
> What if US banks repay government aid money too fast ? [ID:nN05292829]
> Paybacks, smaller asset plan to aid US bailout cash [ID:nN05660716]
> Big US banks may not be free after TARP repayment [ID:nN07299707]
> Tilt toward emerging markets to keep US dollar down [ID:nN04636207]
> Rising interest rates may rein in world equity rally [ID:nL3140790]
FACTBOXES
> US banks that are repaying TARP bailout money [ID:nN09372318]
> US banks raise $65 bln after stress tests [ID:nSP432506]
> Draft agenda for G8 finance ministers meeting June 12-13 [ID:nL41010670]
> Where has all the US bailout money gone ? [ID:nN0289041]
> The Federal Reserve's evolving liquidity toolkit [ID:nN19437787]
> Major US financial regulation reform initiatives [ID:nN14510432]
> Obama administration efforts to tackle financial crisis [ID:nN14509260]
> US regulators propose regulating OTC derivatives [ID:nN13627181]
> Facts and figures from Obama's budget [ID:nN06299995]
> US Treasury details toxic asset plan [ID:nLN437165]
> Full text ECB statement on rates, asset buying [ID:nECBTEXT]
> World government actions to limit bank bad loan damage [ID:nLL193589]