Markets play waiting game as reports due

Markets across the world were playing a waiting game yesterday, as investors looked to a week of corporate reporting in the US to provide direction.

The winding down of the war in Iraq drove down the price of traditional safe-havens, bonds and gold, while stocks rose slightly on encouraging earnings news from Citigroup.

The dollar was under mild pressure, and oil prices firmed after dipping earlier on news that production could begin soon from Iraq's oil fields.

Ulster Bank's financial markets economist, Mr Niall Dunne, said he expected the dollar, which yesterday slipped by 0.2 per cent against the euro to reach $1.0772, would remain weak going forward.

Mr Dunne is expecting the US currency to slip back to $1.10 by year end as further negative news on the US economy emerges.

"The bad news is already out there for Europe," he said.

Wall Street got its latest dose of sluggish economic data yesterday when the government said inventories at US businesses in February climbed to their highest level since September 2001.

The report also showed the biggest sales decline in more than a year.

Oil prices meanwhile slipped for much of the day as traders took the fall of Iraqi city Tikrit as a sign that the war might be drawing to a close.

However, prices later rallied amid increased scepticism at forecasts that Iraq's oil exports could resume within weeks. - (Additional reporting Reuters, AFP)