WORLD FOREX: Jakarta Bombs,Data Concerns Lift Dollar And Yen

The dollar and yen were firmer against other major currencies on Friday as caution set in before more key U.S. corporate earnings later in the day.

U.S. stocks rallied for a fourth day on Thursday. U.S. stocks futures indexes were a little lower in mid-morning London trade.

"Currency markets are taking their lead from equities, with the dollar and yen generally firmer," said Adam Cole, global head of FX strategy at RBC Capital Markets.

Second quarter earnings results from Citigroup (C.N), Bank of America (BAC.N) and General Electric (GE.N) are all due out later in the day, and the market is seen closely following stock market reaction to those results.

Stellar earnings results from Goldman Sachs (GS.N) and JPMorgan Chase (JPM.N) earlier this week, as well as big corporates such as Intel (INTC.O), IBM (IBM.N) and Google (GOOG.O) exceeding forecasts have buoyed risk-taking sentiment.

Markets shrugged off euro zone trade data for May, which posted a surplus of 1.9 billion euros, slightly lower than forecasts for 2.7 billion euros.

By 0903 GMT, the euro was down 0.3 percent at $1.4101 and down 0.3 percent at 132.20 yen.

Brighter sentiment had almost caused currency pairs to break out of consolidation patterns, but not quite. Euro/dollar was holding its symmetrical triangle dating back to the start of June.

The euro is also on track for its best weekly performance against the dollar in two months, or up 0.9 percent on the week.

The dollar index was up 0.3 percent at 79.451 .DXY after falling to a six-week low at 79.131 the previous day.

Sterling was down 0.7 percent at $1.6317 and down 0.8 percent at 152.94 yen.

The U.S. currency eased 0.1 percent to 93.70 yen.

The dollar dipped to a five-month low of 91.73 yen in July and its rise stalled at 94.46 yen this week -- right around a 38.2 percent Fibonacci retracement of the dollar's fall from its high in June of 98.90 yen down to the five-month trough.

Risk sentiment was dampened after bomb blasts at hotels in Jakarta, although most analysts did not expect any lasting effect on markets.

"The blasts have added to this direction in terms of risk trades coming off," said Mitul Kotecha, head of FX strategy at Calyon in Hong Kong, but added it wasn't a big move. link.....