October 21st, 2010
08:32 PM ET

Downtrodden dollar near rock bottom

A look at the day's business news headlines:

Stocks eke out gains

U.S. stocks ended a shade higher Thursday after seesawing throughout the session, as investors balanced strong earnings with building speculation that the Fed's next round of asset-buying won't be as dramatic as anticipated.

The Dow Jones industrial average rose 39 points, or 0.35 percent, the S&P 500 ticked up 2 points, or 0.2 percent, and the Nasdaq edged up 2 points, or 0.1 percent.

Stocks have been on a roller coaster this week, starting with gains on
Monday that dived to 2-month lows on Tuesday and ended sharply higher Wednesday.

Investors have been taking in mixed earnings results, and waiting for clues about the next round of asset purchases from the Federal Reserve. There has been growing speculation over the past month that the Fed will launch more quantitative easing. The move - known as QE2 - would mark the second round of large-scale asset purchases of U.S. Treasuries by the Fed, as part of its effort to get the economy moving.

Downtrodden dollar near rock bottom

After freefalling for weeks, the U.S. dollar appears to finally be groping for a bottom.

The dollar has been in a tailspin since late August, when comments from Federal Reserve chairman Ben Bernanke raised speculation that the central bank will announce additional stimulus measures in November.

But investors say the market has "priced in" the expected Fed move, clearing the way for the dollar to find support around current levels. The dollar index, which tracks the greenback against a basket of currencies, fell to a low of 76.5 this week from a high above 83 in late August.

But the dollar rebounded Thursday against the euro, pound and yen - a good start, analysts say.

Bond traders wait for Fed's next move

Treasuries continued to trade in a narrow range Thursday as investors remained on the sidelines in anticipation that the Federal Reserve will soon take action to stimulate the economy.

Yields for the benchmark 10-year note edged higher to 2.52 percent from 2.48 percent late Wednesday. The 2-year note's yield held steady at 0.36 percent and 5-year note's yields rose to 1.13 percent. The yield on the 30-year bond inched up to 3.92 percent.

Yields have fallen into a holding pattern this week as traders take a wait-and-approach leading up to the Fed's next policy meeting next month. Investors have pushed Treasury yields lower in anticipation that the Fed will launch a second round of asset purchases - or so-called quantitative easing - in an effort to stimulate the economy at the conclusion of its two-day meeting Nov. 3.

- CNNMoney.com staff reporters Blake Ellis, Ben Rooney and Hibah Yousuf contributed to this report.

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Filed under: Economy
soundoff (2 Responses)
  1. ford andrus

    When you say asset purchases by the Federal Reserve does that mean turn up the dial on the printing press?

    October 21, 2010 at 10:20 pm | Report abuse |
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