The euro snapped a two-day decline against the dollar on growing speculation the European Central Bank will raise interest rates next month while the Federal Reserve leaves borrowing costs unchanged. The 15-nation currency also traded near a seven-month high against the yen after ECB Executive Board Member Juergen Stark said the markets understood the bank's signal to raise borrowing costs next month. The yen fell as rising stocks fueled demand for purchases of higher-yielding currencies funded in Japan.

closing
Nikkei +162.31 +1.16% 14,183.48
Topix -14.34 -1,0% 1 383,20
FTSE -104.00 -1.78% 5,723.30
DAX -120.84 -1.78% 6,650.26
CAC -100.17 -2.10% 4,660.91
Dow -205.99 -1.68% 12,083.77
NASDAQ -54.93 -2.24% 2,394.01
S&P -22.95 -1.69% 1,335.49
10yr Note -0.2600 -0.063% 4.073%
NYMEX Crude Oil +5.07 +3.86% 136.38
Gold +11.70 +1.34% 882.90

Japanese shares rebounded as investors snapped up shares of automakers after analysts said a weakening yen will boost profit.
Fuji Heavy jumped 8.8%, the steepest climb since April 11 and leading gains on the Nikkei. Morgan Stanley analyst Noriaki Hirakata raised the carmaker to ``equalweight'' from ``underweight,'' citing strong sales of its Forester sport- utility vehicle and the weakening Japanese currency. Mazda Motor Corp. added 5.1%, while Toyota gained 2.4%.
Promise, Japan's second-biggest consumer lender, sank 4%, while smaller rival Takefuji Corp. tumbled 4.8%. A gauge tracking consumer lenders was the second-biggest decliner among the Topix's 33 industry groups.
Daiwa House Industry Co., Japan's biggest homebuilder, dived 5.8%, the sharpest drop since March 3, after cancelling the listing of a real estate investment trust. Sun Frontier Fudosan Co., a provider of property-management services, tumbled 8.3%, while NTT Urban Development Corp. fell 7.3%.

European stocks drifted lower for a sixth day, the longest losing streak since 2005, on speculation rising inflation will force central banks to increase interest rates, worsening the outlook for lenders as the economy slows.
Royal Bank of Scotland dropped 9%. Chief Executive Officer Fred Goodwin said Britain's second- biggest bank faces ``more bad news than good news'' for as long as 15 months. While RBS is sticking with its April estimate that this year's credit-related writedowns will be 5.9 billion pounds ($11.5 billion), Goodwin declined to say whether the bank will meet analysts' 2008 profit estimates.
HBOS sank 12%, less than the 275 pence price of its rights offer. The U.K.'s biggest mortgage lender fell below the price of its 4 billion-pound ($7.9 billion) offer amid concern a slowdown in the real-estate market will erode earnings. Barratt Developments, the U.K.'s second-largest homebuilder by volume, tumbled 21%. Taylor Wimpey Plc, the U.K.'s biggest homes developer, plunged 19%. Persimmon sank 3%, Berkeley slipped 6.4%, and Bellway declined 11%. Redrow lost 19%, and Galliford fell 4.6%. Next Plc dropped 7.4%, the lowest since July 2003. Home Retail Group Plc fell 2.4%, while Kingfisher Plc lost 3.3%.

U.S. stocks fell Wednesday, pushing the Standard & Poor's 500 Index to its lowest level in two months, as banks and transportation companies plunged on speculation faster inflation will force central banks to raise interest rates.
Lehman Brothers stock fell as investors continued to react to the company's huge quarterly loss announced earlier this week. Merrill Lynch downgraded the stock to "neutral" from "buy."
And Church said that the financial sector was being plagued by vague market rumors that supposedly bullet-proof Goldman Sachs could take a big hit.
Anheuser-Busch stock could be active Thursday after it was announced late Wednesday that Belgian rival InBev has made a nearly $47 billion offer for the company. Reports suggested InBev was interested in the maker of Bud a few weeks ago. Shares gained 7% in after-hours trading. Corporate Express NV, a Dutch distributor of office supplies, accepted an improved $2.7 billion bid from Staples.
Alcoa tumbled almost 8% after a JPMorgan analyst said that the aluminum producer is not looking to sell itself or spin off part of its business and that this will be a disappointment for Wall Street.