Currencies
The euro on Friday dropped to its lowest against the U.S. dollar in nearly 17 months and tumbled to an 11-year low versus the yen, pressured by talk of a downgrade in the credit ratings of several euro zone countries later in the session.
A senior euro zone government source said Standard & Poor's is set to downgrade the ratings of euro zone countries, but not Germany's.
This was later confirmed by French Finance Minister Francois Baroin, who said France and other euro zone countries have been warned that it would be downgraded by S&P.
The euro plunged to a low of $1.26240, its weakest level since late August 2010. It last traded at $1.26641, down 1.3 percent on the day. The euro was on track for its third straight weekly loss.
The single euro zone currency also fell to 97.200 yen, its lowest since 2000 and last changed hands at 97.336, down 1.1 percent.
Losses in the euro propelled the dollar index to its highest since mid-September 2010 at 81.784. It was last 81.548, up nearly 1 percent on the day.
The dollar, meanwhile, was 0.3 percent higher against the yen at 76.900 yen.
Energy
Oil prices fell on Friday, posting a loss for the week, as anticipation of downgrades by Standard & Poor's of several euro zone countries countered the supportive effect of anxiety about Nigerian strikes and Iranian threats to shipping.
After the U.S. stock market close and oil price settlements, the credit ratings agency did lower ratings for France, Italy, Spain and others in the European single-currency bloc, though it left Germany's AAA rating intact.
Ahead of its contract expiration on Monday, Brent February crude fell 82 cents to settle at $110.44 a barrel. It fell intraday to $109.71, just above its 100-day moving average of $109.69, after retreating from a $112.50 high.
U.S. February crude fell 40 cents to settle at $98.70 a barrel, having swung from $97.70 to $100.19. For the week, U.S. front-month crude lost 2.82 percent, wiping out the previous week's 2.76 percent gain.
Precious metals
Gold fell 1 percent on Friday, after the dollar surged against the euro and fears about an imminent credit downgrade of euro zone countries prompted bullion investors to take profits on the recent rally.
Spot gold was down 1 percent at $1,633.90 an ounce. It was still up about 5 percent so far this year, thanks to buying by investors re-entering the market after a 10 percent drop in December.
U.S. gold futures for February delivery settled down $16.90 an ounce at $1,630.80.
Silver was down 2.5 percent at $29.51 an ounce. Spot platinum was down 0.7 percent at $1,481.24 an ounce.
Spot palladium was down 0.2 percent at $635.22 an ounce.
Stock indices
U.S. stocks dropped on Friday, snapping a four-day winning streak after news reports that Standard & Poor's would downgrade credit ratings on several euro-zone countries.
Friday's slide came as investors' focus shifted back to the euro zone's debt crisis.
The Friday selloff shows Europe's debt problems can still make U.S. investors skittish. However, it is notable that the major U.S. stock indexes finished well off the day's lows.
The Dow Jones industrial average dropped 48.96 points, or 0.39 percent, to 12,422.06 at the close.
The Standard & Poor's 500 Index lost 6.41 points, or 0.49 percent, to 1,289.09.
The Nasdaq Composite Index fell 14.03 points, or 0.51 percent, to 2,710.67.
Investors will look to earnings next week for insight on how the euro zone's debt woes may affect profits.
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