* World stocks up as risk aversion eases
* U.S. dollar, Treasuries unwind gains as fears soothed
* U.S. stocks fall as consumers spend less vs year ago
(Updates with U.S. prices, adds byline, dateline, previous:
LONDON)
By Manuela Badawy
NEW YORK, Nov 30 (Reuters) - World stocks rose on Monday as
shock waves from Dubai's debt delay proposal died down.
The U.S. dollar fell against the euro after United Arab
Emirates promised liquidity, easing worries about a default.
Dubai's proposed delay last week in repaying billions of
dollars of debts of its state-owned conglomerate Dubai World
and property subsidiary Nakheel roiled global markets, raising
fears that the emirate which funded a spectacular building boom
on a mountain of debt could default. []
For a graph on the Emirates' debt please click on:
http://graphics.thomsonreuters.com/119/ME_DBTSK1109.gif
The MSCI world stock index <.MIWD00000PUS> was up 0.15
percent, gaining 28.6 percent so far this year.
The UAE central bank's decision on Sunday to provide
emergency liquidity to its banks helped ease some concerns and
prompted a bounce back in emerging markets across Asia.
Emerging Markets <.MSCIEF> were up 1.18 percent while the
MSCI index of Asia Pacific stocks traded outside Japan
<.MIAPJ0000PUS> rose 2.64 percent.
The safe-haven U.S. dollar fell against a basket of
currencies <.DXY> by 0.13 percent as investors' fears of a
deterioration in the tepid global economic recovery calmed.
"We've seen risk aversion decrease from the levels we saw
on Thursday," said Camilla Sutton, currency strategist at
Scotia Capital in Toronto. "All in all, last week just shows
how vulnerable markets are to any fears."
The euro <EUR=> was up 0.19 percent at $1.4994. while
against the Japanese yen, the dollar <JPY=> was down 0.23
percent at 86.21 after a Japanese official said the government
would try to stem the currency's rise, although did not specify
any measures. []
U.S. Treasuries also retreated unwinding gains made late
last week on safe-haven buying.
Benchmark 10-year Treasury notes <US10YT=RR> traded 11/32
lower in price, its yield rising to 3.24 percent from 3.21
percent late Friday. Two-year Treasury notes <US2YT=RR> were
flat, yielding 0.70 percent. The yields dipped to 0.62 percent
Friday, the lowest since last December.
SHOPPING IN FOCUS
U.S. stocks fell by midday in New York as investors worried
that the holiday shopping season might have gotten off to a
tepid start as consumers trimmed purchases over the
Thanksgiving Day holiday amid concerns about an uncertain
economy.
The Dow Jones industrial average <> was down 0.31
percent, at 10,278.03. The Standard & Poor's 500 Index <.SPX>
was down 0.33 percent, at 1,087.94 while the Nasdaq Composite
Index <> was down 0.65 percent, at 2,124.45.
Consumer spending, the backbone of the U.S. economy
accounting for two-thirds of activity, was significantly less
per person at the start of the holiday season even than last
year, when Lehman Brothers' cataclysmic collapse paralyzed the
global financial system.
Meanwhile, European shares fell to their lowest close in
more than three weeks, with oil companies among the biggest
fallers, as worries about Dubai's debt continued to unsettle
European equity markets.
The FTSEurofirst 300 <> index of top European shares
ended 1.3 percent lower at 986.70 points, the lowest close
since Nov 4. The index rose 1 percent in November and is up
nearly 53 percent from a lifetime low it hit on March 9.
Dubai's government said on Monday it was not responsible
for the debts of its flagship conglomerate, offering little
clarity on a plan to delay billions in debt repayments that has
rattled world markets. []
Dubai's benchmark index closed 7.3 percent lower on Monday.
"The new theme is sovereign crises, rather than the banking
crisis. But, perversely, these kind of risks mean that interest
rates will stay low. No government in its right mind will start
to tighten all of a sudden. We think the market will go
higher." said Teun Draaisma, equity strategist at Morgan
Stanley, in London.
UK banks have the biggest loan exposure to the UAE.
(Additional reporting by Wanfeng Zhou in New York, Mike Dolan
and Brian Gorman in London;Editing by Andrew Hay )
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