G20 rattles stocks, US dollar

World stocks and the US dollar wavered on Friday before a meeting of the Group of 20 leading economies that is keeping markets choppy and traders skittish as they took profits after this week's run-up.

Uncertainty about the outcome of the meeting of G20 finance ministers, who seek a common path to manage global trade, prompted some investors to moderate their dollar-selling until the gathering in South Korea ends this weekend.

Wall Street stocks were little changed, and European shares edged lower from six-month highs as the dollar rose slightly and was on track to snap a five-week losing streak against major currencies.

US Treasury secretary Timothy Geithner said that countries should refrain from currency policies designed to gain a competitive edge and should aim instead at containing trade imbalances.

Canada said it supported the proposals. However, developing economies such as China might cool to the idea of letting their currencies strengthen if the US Federal Reserve embarks on an expected new programme to boost money supply.

"It's unlikely the G20 meeting will produce any substantial clarity regarding the direction of currencies. It will not prevent the US Federal Reserve from announcing a new round of quantitative easing," said UniCredit analyst Tammo Greetfeld.

While traders would not rule out another lurch lower for the dollar, which fell about 7% against major currencies over the past month, they said large bets against the dollar pointed to a correction.

The dollar rose slightly against major currencies, with the US Dollar index up 0.14% at 77.538 and was up about 0.4% this week, its first weekly gain since mid-September.

The euro was barely changed against the dollar at $1.3915, and against the Japanese yen, the dollar was up 0.01% at 81.35.

"The dollar has fallen over the last month and positions are somewhat extended. We saw the tide turning a bit this week," said Nick Bennenbroek, currency strategist at Wells Fargo in New York.

The Dow was down marginally, but the Nasdaq and S&P were slightly higher.

Oil prices rose above $81 a barrel as positive German data stoked commodity buying. US crude futures were up 56 cents at $81.12 a barrel, while ICE Brent in London rose 57 cents to $82.40 a barrel.

US government debt prices fell slightly.

Gold prices steadied, recovering much of their losses that took them to two-and-a-half-week lows earlier in the session. Spot gold prices rose slightly to $1323.35 an ounce. Gold investors were wary whether any clear agreement to tackle currency imbalances would be reached at the G20 meeting.

Japan's Nikkei share average edged up 0.4% in thin trade, while the MSCI Asia Pacific ex-Japan index was largely unchanged on the day.

• The rand firmed slightly against the dollar to R6.94 on Friday, but was off its session highs as dealers traded with caution ahead of the medium-term budget policy statement on Wednesday and this weekend's G20 meeting.

Stocks snapped two straight days of gains, with the JSE's Top 40 index falling 1.18% to 26764. Thirty-six out of the 40 stocks on the blue-chip index were in the red, and one was unchanged. The All Share Index gave up 1.06% to 30118.