NEW YORK: The US dollar and shares around the world recovered on Tuesday on expectations that the Federal Reserve will maintain its stimulus program to bolster the nascent economic recovery.
Markets were generally more settled than in recent sessions and as a lull in this week's busy schedule of central bank meetings and US data offered a break from recent sharp moves.
Many investors are likely to hold off making big bets until the non-farm payrolls report due on Friday shows the employment situation, the key factor for the Fed's decision on monetary policy. On Wednesday the market get an anecdotal look at economic conditions from the Fed's Beige Book.
And some analysts point to technical factors to say the market, with the S&P 500 up more than 15 percent so far this year, is not as strong as it looks.
"It seems like the market just wants to go higher and higher, but one thing that worries me is the advance-decline numbers which hit the worst in four years yesterday," said Frank Gretz, market analyst and technician for brokerage Wellington Shields & Co in New York.
The ratio of advancing stocks to declining stocks is used to gauge the strength of a an index price trend and the chance it will reverse.
The Dow Jones industrial average was up 21.57 points, or 0.14 percent, at 15,275.60. The Standard & Poor's 500 Index was up 3.93 points, or 0.24 percent, at 1,644.35. The Nasdaq Composite Index was up 13.47 points, or 0.39 percent, at 3,478.84.
European stocks were just off their highs of the day but remained 0.6 percent higher and on course to snap a two-day losing streak that had left them at their lowest level since early May.
The dollar was up 0.7 percent against the yen, while the euro was down 0.1 percent against the dollar.
As the US financial markets session began, a report showed the US trade deficit widened less than expected in April as the lowest petroleum bill in nearly 2-1/2 years tempered the rise in imports, while exports hit a four-month high. .
But a report released on Monday showed the Institute for Supply Management's index of US factory activity fell to its lowest since June 2009 and tempered expectations that the Fed would retrace its stimulus measures. This left investors to focus more on Friday's US jobs report than any other data this week.
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