* Hopes of ECB action on crisis help lift the euro
* Crude oil rises as hurricane weighs on U.S. production
* Aussie hits five-week low on global economy concerns
By Rodrigo Campos
NEW YORK, Aug 28 (Reuters) – The euro rose against the U.S.
dollar o n T uesday on bets the European Central Bank would act
soon to tackle the bloc’s debt crisis while U.S. crude oil
prices edged higher as Hurricane Isaac approached the Gulf
Coast.
Stocks were little changed on Wall Street as mixed data gave
investors little indication whether Federal Reserve Chairman Ben
Bernanke might signal more economic stimulus from the Fed when
he speaks on Friday.
Trading is very light, following the lowest volume for a
full session so far this year.
U.S. crude prices rose 0.8 percent as Hurricane Isaac
made its way through the Gulf of Mexico, forcing companies to
close down oil rigs and refineries.
Investors were looking ahead to Bernanke’s speech on Friday
at an annual meeting of central bankers in Jackson Hole,
Wyoming, where clues on more stimulus could translate into a
weaker dollar.
The European Central Bank said its president, Mario Draghi,
will not attend the conference due to a heavy workload, news
that gave further support to the euro.
Draghi’s absence is seen as a hint that “he will be busy
finalizing the details of policy proposals to be unveiled in the
coming weeks,” according to Nick Bennenbroek, head of currency
strategy at Wells Fargo Bank. The ECB will meet on September 6.
The single currency rose 0.55 percent to $1.2568.
Upbeat U.S. housing data made it harder for investors to
determine if the Fed will announce further stimulus to the U.S.
economy, a bet that has supported a recent rally in equities and
other risk assets.
“Looks like we are taking a wait-and-see on Bernanke,” said
Jack Ablin, chief investment officer at Harris Private Bank in
Chicago.
He said a handful of global economic indicators were mixed,
leaving room for the Fed to pump more money into the economy.
“Unfortunately a fair amount of stimulus is probably priced
in so we are at a period now where bad news is good news until
we hear what (Bernanke) is actually going to do,” said Ablin.
The Dow Jones industrial average dipped 10.10 points,
or 0.08 percent, to 13,114.57. The S&P; 500 Index gained
0.11 points, or 0.01 percent, to 1,410.55. The Nasdaq Composite
added 4.48 points, or 0.15 percent, to 3,077.68.
An MSCI gauge of global equities fell 0.14 percent
and the pan European FTSEurofirst 300 index closed down
0.7 percent.
Global growth worries resurfaced after Japan cut its
assessment for the economy, citing slow-downs in the United
States and China as well as Europe’s debt crisis.
The commodity-linked Australian dollar hit a five-week low
of $1.0346 before bouncing back slightly.
Adding to signs of weakness, Spain said its recession had
deepened in the second quarter as domestic spending slumped in
the wake of tough austerity measures aimed at tackling the
government’s fiscal problems.
U.S. Treasuries prices edged up ahead of a sale of $35
billion of two-year notes as traders anticipated hints from
Bernanke of possible further economic stimulus.
The benchmark 10-year U.S. Treasury note was up
9/32, with the yield at 1.6199 percent.
