Oil and stocks dip on recovery doubts
By Herbert Lash
NEW YORK (Reuters) - U.S. stocks and oil prices turned south on Friday on resurgent worries following the recent rally in the face of economic data that still show a mixed picture of when economies will pull out of a deep global recession.
The dollar and yen rose as worries persisted about global prospects despite better-than-expected U.S. economic news, prompting investors to seek shelter in the two currencies.
Gold climbed to a six-week high after data showed U.S. core inflation rose more than expected in April, boosting the precious metal's appeal as a hedge against rising prices.
Oil fell towards $56 a barrel, pressured by forecasts of weak global demand and the stronger dollar.
U.S. economic reports that suggested the recession's worst phase was past were eclipsed by worries about weak demand for oil.
Reports showing the euro-zone economy contracted at its fastest pace on record added to worries on when economies will turn the corner.
The euro-zone economy shrank 2.5 percent quarter-on-quarter at the end of March, and 4.6 percent from the same period a year ago, driven by a plunge in German output.
"We had some negative news coming from Europe earlier today," said Michael Woolfolk, a senior currency analyst at The Bank of New York Mellon, noting the "market remains jittery." Continued...
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