Forex@all

The Dow Jones Industrial Average finished above its intraday low, supporting the risk appetite trade out of the dollar, a funding currency. The euroforex had already strengthened overnight, ahead of key U.S. first-quarter earnings releases expected later this week. In the coming days, JPMorgan Chase (JPM), Citigroup (C) and others are scheduled to report earnings.

Technical trading was also likely a major factor in allowing the euro to advance more than two U.S. cents over the course of Monday's session. More traders hopped on as the currency broke through technically important levels, further extending the euro's rally.

But currency movements were likely exaggerated with many markets, including much of Europe, still shut for the Easter holiday. The forex market thin trading conditions often result in volatility.

The euro gained as high as $1.3395 and Y134.02, its highest levels since last Tuesday.

The dollar was also sold against the yen. It fell to a two-session low of Y99.86.

U.S. data that could swing currencies again on Tuesday include March retail sales and the producer price index.

Monday afternoon, the euro was at $1.3376, well above $1.3142 late Friday. The dollar forex market was at Y100.04, down from Y100.38, according to EBS. The euro was at Y133.82, up from Y131.95. The U.K. pound forex market was at $1.4869. Data for the pound were unavailable Friday due to the holiday. The dollar was at CHF1.1314, down from CHF1.1579.

Sentiment on the euro-dollar pair have been in flux since late March on equally uncertain economic outlooks for both the euro zone and U.S. This had led the pair to fluctuate back and forth inside a range without any clear direction yet.

Meanwhile, the Australian dollar, another risk-positive currency that has been rallying for more than a month, rose to its highest level since October at $0.7323.

Besides technical positioning, the Aussie dollar was also aided by a report that showed Chinese lending rose to a record high in March. China is a major trading partner of Australia.

China's broadest measure of money supply, M2, surged 25.51% at the end of March from a year earlier as new yuan loans hit a new monthly record high, government data showed Saturday.

China's central bank on Sunday said it would ensure there was enough credit to meet the needs of the economy. While the PBOC said it was sticking to a moderately loose monetary policy, it wants the credit to go to the right sectors and said it would control loans going to the wrong ones.

The Canadian dollar also mounted a significant advance Monday, rising to its highest level since the beginning of February on the rebound in riskier trades in a thin market.

The U.S. dollar fell to C$1.2166 from C$1.2256 late Thursday.

The poor sales data, combined with a sharp drop in wholesale prices, came just as the corporate earnings season, usually a volatile time in the market, got under way. The Dow Jones industrials lost nearly 140 points.

Underscoring the market's sensitivity, shares in Intel Corp. fell sharply in after-hours trading after the chipmaker reported weaker results after the bell and didn't offer a forecast for revenue.

Investors are already braced for bad earnings but are highly anxious about forecasts from companies that could indicate a weaker economy. Poor outlooks in the last earnings season in January derailed a 20 percent rally, and some fear the market's current five-week rally could be vulnerable as well.

Financial stocks tumbled after Goldman Sachs Group Inc. announced strong profits but said it would raise $5 billion to repay government bailout money. Investors speculated that other major banks might follow suit, which would put pressure on their stocks. Citigroup Inc. and JPMorgan Chase & Co. are also due to report results this week.

The Dow closed down 137.63, or 1.7 percent, at 7,920.18.

Broader measures also lost ground after three days of gains. The Standard & Poor's 500 index fell 17.23, or 2 percent, to 841.50, and the Nasdaq composite index fell 27.59, or 1.7 percent, to 1,625.72.

Tuesday's selling was orderly and extended a give-and-take pattern the market has followed since halting a steep slide over the first two months of the year. Stocks have risen from 12-year lows since then on hopes that banks are getting through the worst of their problems and the economy might be bottoming out, though both the Dow and S&P 500 are still below where they started the year.

The unexpected 1.1 slump in retail sales in March undermined the market's brightening outlook for the economy. The drop was far worse than the increase of 0.3 percent that analysts polled by Thomson Reuters expected and marked the biggest fall in three months. Investors watch retail sales trends closely as a barometer of consumer spending, which makes up two-thirds of U.S. economic activity.

"The choppy data that we're seeing, whether it's economic or earnings, reminds us that we're still not out of the woods," said Sean Simko, head of fixed income management at SEI Investments in Philadelphia. "The market always has a tendency to go too far too fast."

Investors took little comfort from speeches by President Barack Obama and Federal Reserve Chairman Ben Bernanke that there have been hopeful signs about the economy but that a sustained recovery won't arrive quickly.

A separate report on wholesale prices gave another poor reading on the economy.

The Labor Department said wholesale prices tumbled 1.2 percent in March as the cost of gasoline, other energy products and food fell sharply. Falling prices fan worries about a spiraling effect where consumers and businesses would cut spending out of fear that they would pay too much for something today that could be worth less tomorrow.

The drop in stocks followed more signs that some companies reporting earnings for the first quarter might be able to top Wall Street's modest expectations.

After the end of trading Tuesday, railroad operator CSX said its first-quarter profit fell 30 percent from a year earlier, but the results came in well above Wall Street's expectations.

Johnson & Johnson said before the opening bell that its first-quarter profit dipped, but not as much as expected. The health care products maker was one of four stocks among the 30 that make up the Dow industrials to show a gain. The stock rose 22 cents to $51.37.

Goldman released its results a day early Monday, reporting after the end of trading that it earned $1.66 billion in the quarter, well above what analysts were expecting. The company said it would raise $5 billion in stock in hopes of repaying the $10 billion investment it received from the government last year.

Goldman shares fell $15.04, or 11.6 percent, to $115.11 after its stock offering was priced at $123 per share, a discount of 5.5 percent to Monday's closing price.

Most other financial stocks slid. JPMorgan fell $3, or 8.9 percent, to $30.70, while Morgan Stanley fell $3.22, or 12 percent, to $23.67.

Jeffrey Frankel, president of Stuart Frankel & Co. in New York, says investors are braced for the worst during earnings season. "There is very little that could come out that will spook traders," he said.

In other market moves, the Russell 2000 index of smaller companies fell 14.83, or 3.2 percent, to 453.22.

Two stocks fell for every one that rose on the New York Stock Exchange, where consolidated volume came to 7.3 billion shares compared with 6.3 billion shares traded Monday.

Bond prices rose after the weak economic readings. That pushed the yield on the 10-year Treasury note down to 2.79 percent from 2.86 percent late Monday Stock Market.

The dollar was mixed against other major currencies, while gold prices fell.

Light, sweet crude fell 64 cents to settle at stock Market. $49.41 a barrel on the New York Mercantile Exchange.

Overseas, Japan's Nikkei stockmarket average fell 0.9 percent. Britain's FTSE 100 rose 0.1 percent, Germany's DAX index gained 1.5 percent, and France's CAC-40 rose 0.9 percent.