gold, oil & usd from the wires

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    LONDON, Dec 23 (Reuters) - Oil prices climbed close to
    three-month highs, boosting European energy stocks, gold rose
    and the dollar eased on Monday after the United States and
    Britain indicated war with Iraq was increasingly likely.
    The U.S. currency fell towards a three-year low against the
    euro and hit its weakest level in nearly four years against the
    safe-haven Swiss franc on nervousness about possible military
    Oil company shares made early gains in Europe but the
    growing fear of war weighed on the market.
    "The main topic this morning is Iraq. All the markets are
    assuming a war will happen, it's just a question of when," said
    a Munich-based European share trader.
    In Washington, a U.S. official said on Sunday the campaign
    to rid Iraq of any weapons of mass destruction was entering its
    final phase. Prime Minister Tony Blair on Friday told British
    troops to prepare for a possible war.
    Gold, seen as a safe store of value in troubled times,
    headed higher, also boosted by the weaker dollar.
    Bullion was last at $343.75, up from $340.35 at the
    New York close but well off last week's six-year high of
    Crude oil prices leapt at the opening of European trade on
    Monday on worries over Iraq, whose oil exports make up nearly
    three percent of global demand, and a protracted strike in
    Venezuela, also a major exporter.
    Brent crude for February was 66 cents higher at $29
    a barrel, not far off the three-month peak of $29.40 reached
    last Thursday.
    "The continuation of the strike coupled with rising tension
    with Iraq has caused prices to jump sharply," said Lawrence
    Eagles of GNI Research.

    Energy stocks BP and TotalFinaElf were
    higher in early trade but major share indices were mixed. The
    FTSE Eurotop 300 index <.FTEU3> was down 0.36 percent while the
    narrower DJ Euro STOXX 50 index <.STOXX50E> was down 0.31
    The Tokyo stock market was closed for a holiday but Hong
    Kong shares fell in low volume as investors cashed out ahead of
    the Christmas holiday.
    The Hang Seng index <.HSI> ended 0.6 percent lower.
    U.S. stock index futures were lower in Europe,
    indicating a weak start on Wall Street. On Friday, U.S. stocks
    closed higher. The Dow Jones Industrial average <.DJI> ended
    1.75 percent higher while the tech heavy Nasdaq index <.IXIC>
    closed up 0.66 percent.
    The dollar fell in European trade against many major
    currencies on anxieties over the economic impact of any war.
    The greenback, which had traded in tight ranges in Asia, was
    last at $1.0308 to the euro , close to a three-year low,
    near a four-year low of 1.42 Swiss francs and hit a
    two-year low against sterling in holiday-thinned trade.
    "Increased tension in the Middle East has got the move going
    and there is no good reason to buy dollars," said Tony Norfield,
    head of foreign exchange research at ABN AMRO.
    Safe haven government bond yields, which move in the
    opposite direction to prices, were lower.
    The two-year German Schatz note was yielding 2.81
    percent, down 1.7 basis points, having earlier matched last
    week's 3-1/2 year low of 2.785 percent. The 10-year benchmark
    German Bund yield was down two basis points at 4.27
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