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Premarket: U.S. dollar stays low as stocks cheer latest record streak

A currency trader watches documents at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Friday, Oct. 13, 2017. Asian stock markets were subdued following losses on Wall Street.

Ahn Young-joon/AP

World stocks rose for a fourth straight day on Friday on expectations of broad-based global growth, while the dollar headed for its worst week in five as investors awaited U.S. inflation data.

MSCI's world equity index, which tracks shares in 47 countries, was up 0.1 per cent after hitting record highs on Thursday.

Earlier in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan hit a 10-year high, up 0.3 per cent on the day.

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European shares rose to their highest level in nearly four months, helped by some well-received earnings updates. The pan-European STOXX600 rose 0.3 per cent and was set for its fifth straight week of gains as were world stocks.

Germany's DAX index was flat, just below the fresh all-time high hit in the previous session, while Britain's FTSE eased back 0.4 per cent after a record close on Thursday.

"(Markets) have certainly been kind to us this year and valuations are increasingly a point of contention," said Fergus Shaw, a partner at Cerno Capital.

"But if we look bottom-up, we see broad based, modest growth supporting corporates generally."

Emerging market stocks were buoyant too as another 0.2 per cent rise set their latest 6-year peak.

In currencies, the dollar stayed on the defensive after minutes from the last U.S. Federal Reserve meeting showed policy makers remained divided on U.S. inflation prospects.

The index which measures the greenback against a basket of six major currencies was 0.1 per cent lower ahead of consumer price inflation data, due at 1230 GMT.

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"The data will likely be disrupted by the hurricanes. But if inflation is picking up, that is still positive for the dollar," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

NEW FED CHIEF

On top of the near-term inflation readings, investors are also looking to whom U.S. President Donald Trump will nominate as successor to Fed Chair Janet Yellen, whose term expires next February.

White House Chief of Staff John Kelly said on Thursday that Trump was "some time away" from making a decision, while another official said Trump had met with Stanford University economist John Taylor of economics text book Taylor-rule fame to discuss the job.

Meanwhile, the euro was nudging higher and set for its biggest weekly rise in a month.

European Central Bank policy makers broadly agreed to extend asset purchases at a lower volume at their October policy meeting with views converging on a nine-month extension, sources at the central bank told Reuters.

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Britain's pound rose to a 10-day high, boosted by a report in Germany's Handelsblatt newspaper that the European Union could offer Britain a two-year transitional Brexit deal.

The most eye-catching move, however, was from digital currency Bitcoin as it soared by as much as 7.4 per cent after Thursday's 13 per cent gain, to hit a record high of $5,846 . It is up more than 450 per cent this year.

The Chief Financial Officer of JPMorgan Chase & Co said the firm was open-minded about the future potential use of digital currencies, appearing to dial back comments last month from his boss, Chief Executive Officer Jamie Dimon, who said bitcoin was a "fraud."

Among commodities, copper prices held firm after hitting a one-month high on Thursday as optimism over the demand outlook from major consumer China fueled buying.

London copper futures were at $6,891 a tonne, up 0.1 per cent on the day.

Oil prices also climbed after data showed both U.S. crude production and inventories had declined. Crude was set for its sixth weekly rise in the last seven weeks. U.S. crude jumped 1.5 per cent to $51.39 a barrel. Brent crude rose $1 to $57.25 a barrel, up nearly 2 per cent on the day.

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