* Stock edge higher on Citigroup, GE results
* Dollar rises to one-month high versus euro
* Bond prices slide as U.S. earnings beat expectations
* Oil over $50, gold extends losses as dollar rises
(Recasts; updates U.S. markets; changes dateline, previous
By Herbert Lash
NEW YORK (Reuters) - Oil prices rose and global
stocks edged higher Friday after a consumer survey bolstered
hopes that the U.S. economy is stabilizing, but clouded
outlooks from Citigroup and General Electric capped gains.
The U.S. dollar extended losses versus the yen as the Dow
and S&P 500 traded in and out of positive territory, boosting
the safe-haven appeal of the Japanese currency. Both the dollar
and the yen gained against the euro.
U.S. Treasury debt prices fell but the selling was
relatively modest in thin volume as investors were caught
between fear of new supply on the one hand and support from
Federal Reserve buying on the other.
But euro zone government debt fell sharply as investors
took a more positive view of Citigroup and GE, driving up
European stock indexes on optimism the deep U.S. recession may
The jump in European equities dented gold's appeal as a
safe-haven, sending prices lower amid a decline in holdings of
the world's main gold exchange-traded fund, the SPDR Gold Trust
U.S. consumers expressed more confidence in the U.S.
economy than they have had since the sudden collapse of Lehman
Brothers in September, the Reuters/University of Michigan
Surveys of Consumers showed, giving equities a lift.
But comments from the two U.S. corporate icons weighed on
market sentiment despite their better-than-expected results.
Citigroup indicated consumer credit deterioration remained a
worry and GE suggested that fallout from commercial real estate
losses may worsen.
"Investors after taking a close look at Citi are
reevaluating the news. It's really mostly accounting benefit
from moving to a mark-to-model approach," said Jack Ablin,
chief investment officer at Harris Private Bank in Chicago.
Shares of Citigroup dropped 2.99 percent to $3.89,
and GE rose 3.26 percent to $12.67.
At 1:25 p.m., the Dow Jones industrial average
gained 35.29 points, or 0.43 percent, to 8,160.72. The Standard
& Poor's 500 Index rose 6.16 points, or 0.71 percent, to
871.46. The Nasdaq Composite Index dropped 0.68 point,
or 0.04 percent, to 1,669.76.
The FTSEurofirst 300 index of top European shares
rose 1.6 percent to 814.69 points, its highest close in more
than two months. Over the week, the index gained 4.7 percent.
Banks in Europe rallied on hopes that the worst was over
for the battered sector.
BNP Paribas rose 4.6 percent, Barclays
jumped 7.1 percent, Deutsche Bank added 6.2 percent,
Lloyds and Royal Bank of Scotland both soared
about 14 percent and UBS climbed 7.3 percent.
"What this shows, and what the market is reacting to
directly is that banking is very profitable if you take out all
the stupid stuff, like exotic derivatives," said David Evans,
market analyst at BetOnMarkets.com.
Oil rose above $50 a barrel, helped by the strong European
equities markets, although brimming crude inventories capped
Crude oil prices have been limited by weak demand and
rising stocks, which in the United States have reached their
highest level in nearly 19 years.
"Stronger equities are providing support to crude oil but
the commodity is starting to feel fatigued, pivoting around $50
a barrel without any momentum," said Olivier Jakob of
U.S. light sweet crude oil rose 66 cents to $50.64 a
A speech by the European Central Bank President Jean-Claude
Trichet failed to dispel uncertainty about the bank's policy
steps next month, weighing on the euro. The euro fell
1.04 percent at $1.3041.
The dollar rose against a basket of major currencies, with
the U.S. Dollar Index up 0.84 percent at 85.922. Against
the yen, the dollar slipped 0.12 percent at 99.15.
The benchmark 10-year U.S. Treasury note fell
26/32 in price to yield 2.93 percent. The 2-year U.S. Treasury
note fell 5/32 in price yield 0.98 percent.
Asian stocks rose after results on Thursday from JPMorgan
and Google kept shares on track for a sixth week of gains.
The MSCI index of Asia Pacific stocks outside Japan
edged up 0.3 percent on the day, while Japan's
Nikkei share average climbed 1.7 percent.
(To read Reuters Global Investing blog, click on
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(Reporting by Edward Krudy, Wanfeng Zhou, Pedro Nicolaci da
Costa in New York; Brian Gorman, Catherine Bosley, Ikuko Kao
and Jan Harvey in London; writing by Herbert Lash; Editing by