Dollar index hits highest since April; S&P 500 up slightly
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By Caroline Valetkevitch
NEW YORK (Reuters) - The U.S. dollar index touched its highest since April on Tuesday on growing expectations the Federal Reserve will raise interest rates next month, while U.S. stocks ended up after a late-session bounce.
Oil prices ended higher, rebounding after the International Energy Agency estimated investment in oil would slump more than 20 percent this year, a trend it saw continuing into 2016.
Consumer discretionary shares including Amazon.com (NASDAQ: AMZN) bolstered the S&P 500, though a drop in Apple (NASDAQ: AAPL) limited the index's advance. World stock indexes slipped as persistent global growth concerns weighed on sentiment.
A bigger-than-expected fall in Chinese inflation following disappointing trade figures over the weekend underlined the problems in an economy that has driven world growth for a decade. But the data also added to expectations of more stimulus measures from Beijing to counter any slowdown.
Equities investors also were preparing for a possible Fed rate hike in December. Friday's strong U.S. jobs report boosted expectations the Fed will raise rates next month.
"We could face a little more of this kind of trading as we see people position around the idea of a rate increase," said Kurt Brunner, a portfolio manager at Swarthmore Group in Philadelphia. "Over the next couple weeks it could be a little sloppy before we head into Thanksgiving."
The Dow Jones industrial average <.DJI> rose 27.73 points, or 0.16 percent, to 17,758.21, the S&P 500 <.SPX> gained 3.14 points, or 0.15 percent, to 2,081.72 and the Nasdaq Composite <.IXIC> dropped 12.06 points, or 0.24 percent, to 5,083.24.
Apple shares fell 3.2 percent to $116.77 after Credit Suisse said the iPhone maker had lowered component orders by as much as 10 percent.
MSCI's all-country world index <.MIWD00000PUS> dipped 0.2 percent, while European shares <.FTEU3> closed up 0.2 percent, supported by a weak euro.
The dollar climbed to touch a 6-1/2-month high against the euro
Bullish bets on the dollar have grown as an improving U.S. economy have bolstered expectations the Fed would raise rates at its Dec. 15-16 meeting.
At the same time, the dollar's gains pressured gold, with spot gold
U.S. Treasuries prices rose, with benchmark yields retreating from a more than three-month peak on demand from investors seeking bargains after a market selloff on worries about the Fed raising rates in December.
Benchmark 10-year Treasury notes
In the oil market, U.S. crude
(Additional reporting by Richard Leong in New York and Abhiram Nandakumar in Bengaluru; Editing by Nick Zieminski and James Dalgleish)
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