World share markets made a soft start to 2014 on Thursday in the wake of disappointing data on Chinese manufacturing, while investors showed renewed appetite for commodities and the dollar as the new year got underway.
Gold grabbed the limelight with a 1.5 percent jump to $1,220 an ounce, recouping just a little of the losses that made last year its worst in three decades.
The buying spilled over into silver and copper, with dealers talking of demand from Chinese traders looking to pick up commodities on the cheap.
The other action was in the yen, which resumed its long decline on the back of speculation the Bank of Japan will ease policy further while other central banks stay put or begin to rein in the huge amounts of cash being pumped into the economy.
The dollar hovered near a five-year high versus the Japanese currency at 105.35 yen, with the focus on whether U.S. data later in the day will support the case for the Federal Reserve gradually scaling back its bond-buying stimulus.
The euro steadied at 144.70 yen, having clocked up gains of 26 percent over 2013 to reach a five-year peak of 145.67. On the dollar it was down to $1.3733, but still not far from its recent two-year peak of $1.3892.
The drop in the yen has been viewed as positive for Japanese exports and corporate earnings, and a major reason its share markets outperformed all others last year.
European stocks .FTEU3 had started the year at a 5-1/2 year high, but an initial push higher proved short-lived despite the upbeat data as London’s FTSE .FTSE, Paris’s CAC 40.FCHI and Frankfurt’s Dax .GDAXI dropped 0.5, 0.6 and 0.5 percent respectively.
Safe-haven European benchmark German bonds were also out of favor as investors continued to shed them in favor of riskier assets, while the euro sagged to a near one-week low as the dollar .DXY strengthened.