In currency markets, the euro was well off its Monday high near $US1.3100, and retreated back to where it stood late last week before the European Union’s emergency package was unveiled.

The single currency had slumped to a 14-month trough of $US1.2510 last week as fears of a euro zone debt crisis intensified and as some global credit markets showed increasing signs of strain.

“The emergency package is effective in avoiding a near-term crisis. But so much uncertainty remains for the euro zone,” said Tsutomu Soma, senior manager of the foreign securities department at Okasan Securities.

Sterling fell 0.3 per cent to $US1.4811 held back by political uncertainty in Britain following an inconclusive election that left no single party with a clear majority to rule.

Prime Minister Gordon Brown said he would step down in an effort to try to keep his Labour Party in power. Labour and its major rival, the Conservatives, are trying to woo the smaller Liberal Democrats to form a government.

US crude futures dipped 0.5 per cent to $US76.44 a barrel and spot gold edged higher to $US1,205.10 an ounce.

Posted by Shayne Heffernan on May 11th, 2010and filed underEquities, Europe, Latest News, Markets, News & Events.You can follow any responses to this entry through theRSS 2.0You can leave a response by filling following comment form or trackback to this entry from your site