DJI- NEW YORK, July 11 (Reuters) - The Dow and Nasdaq fell on Wednesday, while the dollar hit a two-year high against the euro after minutes from the Federal Reserve's June meeting showed any additional bond buying by the Fed was likely to happen only if the U.S. economy gets weaker.
The benchmark Standard & Poor's 500 Index closed flat, but the Dow slipped 0.4 percent and Nasdaq lost 0.5 percent for the day. The minutes from the Fed's June 19-20 meeting suggested that most policymakers were not yet ready to take bolder action on the sluggish economy. (nW1E8G902C)
The dollar extended gains against the euro, which hit a two-year low of $1.2211 after the minutes. Gold ended nearly flat, trimming its gains following the release of the Fed minutes.
Crude oil futures finished sharply higher, despite mixed signals from the Fed. A tight supply outlook in the North Sea and a drop in U.S. crude stockpiles in the latest week helped lift oil prices.
Investors were hoping the minutes would suggest the U.S. central bank was getting closer to another round of stimulus.
"The minutes do not on the surface suggest a sizable body of support for further immediate action, although it should be borne in mind that the comments were made prior to recent data disappointments," said Peter Buchanan, economist at CIBC World Markets in Toronto.
The Dow Jones industrial average .DJI slipped 48.59 points, or 0.38 percent, to close at 12,604.53. The Standard & Poor's 500 Index .SPX inched down just 0.02 of a point, or 0.00 percent, to 1,341.45. The Nasdaq Composite Index .IXIC declined 14.35 points, or 0.49 percent, to finish at 2,887.98.
OIL GAINS, GOLD FLAT
Crude oil trimmed earlier gains after the minutes also showed that the Fed's staff had lowered its forecast for gross domestic product and projected growth rate to "not materially" exceed potential output until 2014.
"The Fed's lower GDP forecast and lack of clarity on further easing measures has undermined the rally in crude oil," said John Kilduff, partner at Again Capital LLC in New York.
But oil's pullback was short-lived.
Brent crude oil LCOc1, which fell more than 2 percent on Tuesday, rose back above $100 a barrel after the Organization of the Petroleum Exporting Countries left its 2012 world oil demand growth forecast unchanged at 0.9 million barrels per day.
OPEC produces one-third of global oil.
Brent prices also got a lift from news that the combined daily loading volume fo the four benchmark North Sea crude oil streams was expected to fall to a record low in August, based on Retuers calculations, traders said. (nL6E8IB61N)
U.S. government petroleum inventories showed a drawdown last week of 4.7 million barrels, almost four times the forecast in a Reuters poll, but it was overshadowed by larger-than-expected gains in gasoline and distillate stockpiles. EIA/S
Brent crude for August delivery LCOc1 rose $2.26 to settle at $100.23 a barrel. U.S. crude CLc1 advanced $1.90 to settle at $85.81 a barrel.
Gold ended nearly flat as spot gold prices XAU= rose $11.89 to $1,576.30 an ounce.
U.S. COMEX August gold futures GCQ2 settled down $4.10 at $1,575.70 an ounce.
Earlier in Europe, equities steadied, with a weak start to the second-quarter reporting season from the autos and luxury sectors denting sentiment, though technical support levels put a lid on losses in thin and jittery summer trading.
The region's sluggish response to the euro zone's debt crisis sent 10-year German bond yields to new lows.
The FTSEurofirst 300 index .FTEU3 of top European companies closed flat at 1,039.12.
The dollar rebounded and was up against a basket of major trading-partner currencies, with the U.S. Dollar Index .DXY up 0.10 percent at 83.483, slightly off a 52-week high at 83.61.
The euro fell against most major currencies on anxiety over how policymakers plan to tackle the debt crisis after it appeared there would be no quick judgment from a German court on the euro zone's bailout fund.
The euro EUR= was down 0.05 percent at $1.2243.
Germany sold just over 4 billion euros of 10-year government bonds at record low yields, with demand solid due to concerns that the recently agreed anti-crisis measures may not be powerful enough to overcome the euro zone debt crisis.
Yields on 10-year German debt in the secondary market DE10YT=TWEB were lower at 1.271 percent, off the average auction result of 1.31 percent.
NYMEX- NEW YORK, July 11 (Reuters) - U.S. crude futures rose more than 2 percent on Wednesday, supported by data showing crude oil stockpiles fell last week and hopes that economic stimulus may yet be forthcoming from the U.S. Federal Reserve to bolster a sputtering economy.
Prices rebounded from Tuesday's selloff in reaction to the end of a strike by Norway's oil workers.
U.S. crude oil inventories fell 4.7 million barrels last week, the Energy Information Administration said in its weekly report, much more than expected in a Reuters poll of analysts.
CBOT SOYBEAN- Soybean futures on the Chicago Board of Trade fell on profit-taking and wetter forecasts for the U.S. Midwest, traders said, reversing early strength tied to a cut in the U.S. Department of Agriculture's soy yield forecast.
* Soymeal and soyoil followed soybeans lower.
* USDA lowered its U.S. 2012 soybean yield forecast to 40.5bushels per acre, from 43.9 in June, citing hot and dry weatherin the Midwest that scorched the crop. USDA lowered U.S. soyproduction to 3.050 billion bushels from 3.205 billion in June.
* USDA lowered its forecast of U.S. 2012/13 soybean ending stocks to 130 million bushels, from 140 million in June and below the average trade estimate of 141 million.
• USDA cut its forecast of 2011/12 soybean ending stocks to 170 million bushels, in line with the average trade estimate and down from 175 million in June.
• Forecasts called for rain in Illinois and other areas east of the Mississippi River this weekend, a meteorologist said, and the midday run of a major U.S. weather forecasting model indicated additional widespread rains next week. (nL2E8IB9HN)
• Profit-taking noted after spot soybeans Sc1 matched but failed to surpass the all-time high of $16.79-1/2 set on Monday. Funds hold a near-record net long in CBOT soybeans, leaving the market vulnerable to profit-taking and long liquidation.
• Contract highs set in several new-crop soybean contracts and most soymeal contracts.
• China's soy buyers are delaying placing new orders while U.S. prices hover near record highs, hoping prices will ease before they are forced to return to the market to meet potential supply shortages later this year - trade. (nL3E8IA03P)
FCPO- SINGAPORE, July 11 (Reuters) - Malaysian crude palm oil futures slipped on Wednesday on weaker export data, although losses were curbed by tight global oilseed supply and expectations that demand will rise in the next few weeks due to Asian festivals.
The declines in palm oil bucked grain futures, which have risen as a drought in the U.S. grain belt hurts crops, and were mainly driven by a decline in Malaysian palm oil exports for the first 10 days of July, pointing to a decline in demand.
"Despite the lower end-stocks yesterday, demand is slipping away," said a trader with a local commodities brokerage in Malaysia. "Empirical evidence suggests end-stocks could recover back up to 2 million tonnes by end September."
Benchmark September palm oil futures FCPOc3 on the Bursa Malaysia Derivatives Exchange slipped 1.5 percent to close at 3,082 ringgit ($970) per tonne.
Traded volumes stood at 27,591 lots of 25 tonnes each, slightly higher than the usual 25,000 lots.
Malaysian July 1-10 palm oil exports fell by 13.5 and 22.2 percent respectively, according to cargo surveyors Intertek Testing Services and Societe Generale de Surveillance, taking most traders by surprise. PALM/ITS PALM/SGS
The market is also on the lookout for the U.S. Department of Agriculture (USDA) report on grain supplies, due to be released at 1230 GMT, with soybean stocks expected to remain tight following the persistent drought.
But some traders expect demand to pick up by the end of the month, when the Muslim fasting month of Ramadan begins, and then again once top buyers China and India observe major holidays in September through to November.
Palm oil is currently priced lower than other vegetable oils, which also means it is likely to attract buyers.
"Price signals in India are favouring palm oil imports over soybean and sunflower oil. The premium of both sunflower and soybean oil to crude palm oil are at or above recent averages," Victor Thianpiriya, agricultural analyst with ANZ, said in a research note.
Concerns about El Nino may also boost prices. Japan's weather bureau said on Tuesday there is a strong possibility the weather pattern -- which is often linked to droughts in Southeast Asia and could hurt palm oil output -- will emerge this summer. (nL3E8IA1US)
"We expect crude palm oil prices to surge if El Nino is confirmed as fresh fruit bunch production may be reduced by a staggering 30 percent depending on the severity of El Nino," Alan Lim Seong Chun, research analyst with Malaysia's Kenanga Investment bank, said in a note.
REGIONAL EQUITY- BANGKOK, July 11 (Reuters) - Most Southeast Asian stock indexes on Wednesday gained for the second straight day, powered by telecoms stocks, but market turnover was relatively sluggish as doubts remained over the euro zone's ability to tackle its debt crisis.
Malaysia's main index .KLSE advanced 0.32 percent to end at 1,629.45, its record closing high. Singapore's Straits Times Index .FTSTI rose 0.8 percent to 2,989.31, the highest close since May 4 and Thai SET index .SETI gained 0.4 percent to finish at a two-month closing high of 1208.67.
Telecoms stocks were strong, with Malaysia's Axiata Group Bhd AXIA.KL up 3.4 percent and Singapore Telecommunications Ltd STEL.SI 1.8 percent higher. Thai telecoms group Shin Corporation Pcl INTUCH.BK jumped 4.3 percent amid hopes for its high dividend payouts.
