European shares extended gains to close higher on Wednesday, bolstered by a strong open on Wall Street.
Gold fell below $1,650 an ounce after data showed disappointingly small growth in U.S. retail sales in January, while some investors stayed at the sidelines ahead of a G20 meeting later this week, which is expected to set the tone for the gold trade.
The yen traded flat against the dollar Wednesday, a day after sharply rising, as investors grew cautious ahead of a meeting of finance ministers and central bankers later this week.
The world's major economies may be trying to ease concerns about a currency war, but it appears that they are sowing confusion in the foreign exchange markets instead.
Asian shares outside of Japan closed in the green on Wednesday, led by Australian banks and South Korean exporters while the Nikkei lost ground on a firmer yen amid conflicting interpretations of G7 comments about the currency's recent weakness.
President Barack Obama's State of the Union speech Tuesday could drive market focus straight to the next skirmish in the budget and deficit battle with Congress, depending on his tone.
World stock markets have rallied to levels not seen since the collapse of Lehman Brothers in January, but the bull market has screeched to a halt and now one of the world's largest investment banks has downgraded its outlook for global equities.
Billionaire investor Jim Rogers told CNBC's "The Kudlow Report" that the stock rally is just the result of ultra-easy monetary policy by the world's central banks.
Prices for U.S. Treasurys fell on Tuesday as investors looked ahead to retail sales data to shed light on consumer habits on Wednesday after a lackluster debt sale, the first for a total of $72 billion in supply this week.
Japan's Nikkei share average gained 1.9 percent on Tuesday and the yen weakened to a 33-month low against the dollar after a U.S.Treasury official seemed to voice support for Japan's aggressive policies to combat deflation and bolster growth.
The PIMCO Total Return Fund, decreased its mortgage holdings to its lowest level since mid-2011, ahead of the prospect of higher interest rates and emerging inflationary pressures.
Oil prices rose after OPEC raised the outlook for the amount of crude it will need to pump this year to keep supply and demand in balance.
Gold futures settled nearly unchanged at $1,649 per ounce, as the dollar fell following a statement from the Group of Seven industrialized countries reaffirming commitment to market-determined exchange rates.
Tokyo stocks jumped back near a 33-month high on Tuesday while other Asian shares lacked momentum with many regional bourses shut for holidays and as investors await the U.S. president's State of the Union address for trading cues.
The yen rebounded Tuesday, rising from a nearly three-year low against the dollar hit during the previous session, after a G7 official said a statement was meant to express "concern about excess moves" in the Japanese currency.
Gold fell to a one-month low on Monday, as investment appetite for the metal was hurt by a sluggish price performance in the year to date.
U.S. Treasurys dipped slightly but remained within recent ranges on Monday before new Treasury supply this week and a day ahead of President Barack Obama's State of the Union address, which will be watched for any signs of a deal on spending cuts.
Brent crude futures fell on concerns about the euro zone economy, while U.S. crude rose and narrowed the spread between the two contracts, reducing Brent's premium to its U.S. counterpart.
The euro rose against the dollar and yen on Monday after incurring heavy losses for three straight days as an ECB policymaker dismissed talk of intervening to weaken the currency.
U.S. Treasurys ended near flat on Friday after dipping during the session when stocks resumed their climb and traders positioned for $72 billion in new government debt supply next week.
European shares were flat on Friday as talks over the "fiscal cliff" stalled.
European shares closed lower on Wednesday for a third consecutive session, with resurging worries about the global economic outlook undermining investor sentiment.
Standard & Poor's decision to cut Spain's credit rating to one notch above junk status is weighing on markets.