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Dollar gains against the yen and euro; stock indexes decline

Investors weighed the prospects for Japan's fiscal policy as major stock indexes slid on Thursday. The S&P 500 closed at a record high on Wednesday despite the ongoing U.S. shutdown, political risks in France and Japan, and investor anxiety. On Thursday, the euro fell again against dollar. Investors weighed a Gaza ceasefire agreement that could ease Middle East tensions with the stalled peace negotiations in Ukraine when oil prices dropped. Gold prices rose above $4,000 per ounce this week due to safe-haven demand, a weaker US dollar and the desire for a haven. Last week, spot gold fell 1.6% to $3,973.10.

Sanae Takaichi said that she didn't want to see the Japanese yen fall too much. After the comments, the dollar briefly weakened against the yen.

The dollar was up by 0.24% to 153.04yen, after reaching a high of 153.21 earlier. This is the highest level since February 13. The U.S. federal government shutdown that began last week has prevented investors from receiving key economic reports. Adam Sarhan of 50 Park Investments, New York, stated that despite Thursday's decline, the stock market is still buoyant. He added that stocks may weaken if there is a prolonged government shutdown.

He said: "We are in a very solid bull market which refuses to fall meaningfully." "I expect a pullback to happen at some point, but the market is strong for now."

The Dow Jones Industrial Average dropped 297.20, or 0.63 percent, to 46.306.65, while the S&P 500 lost 27.40, or 0.40 percent, to 6,726.41, and the Nasdaq Composite was down 62.14, or 0.27 percent, to 22981.65. JPMorgan Chase CEO Jamie Dimon stated that there is a greater risk of a major correction in the U.S. Stock Market within the next 6 months to 2 years. He cited factors such as geopolitical tensions and government spending.

The MSCI index of global stocks fell by 4.38 points or 0.44% to 917.

The pan-European STOXX 600 Index

The market closed 0.43% lower.

Drag down

French bonds maintained gains from the previous day on the optimism that the country will avoid a snap elections. The office of French President Emmanuel Macron announced on Wednesday that he will appoint a prime minister in the next 48 hours.

The 10-year French bond yield increased by 0.2% on the day to 3.529%. The euro last fell 0.64% to $1.1552.

Brent crude fell by $1.03 and settled at $65.22 a barrel. U.S. crude futures declined by $1.04, settling at $61.51 per barrel.

The yield on the benchmark U.S. 10 year notes increased by 1.5 basis points, to 4.146% from 4.131% at late Wednesday.

(source: Reuters)