Stocks slip, euro falls on debt worries

World stocks pared gains to trade slightly lower on Monday while the euro fell broadly on concerns over the euro zone debt crisis.
Government bond prices on both sides of the Atlantic rose on safe-haven demand spurred by worries over the fiscal shocks in Europe and heightened tension between North and South Korea.
North Korea said it would not react to "reckless" military drills by the South despite an earlier threat to retaliate, and CNN reported that Pyongyang had agreed to the return of nuclear inspectors.
The euro slid to a two-week low versus the U.S. currency and record lows against the Swiss franc and Australian dollar as traders fretted over Europe's debt woes. Moody's five-notch downgrade of Ireland's credit rating last week also weighed.
"Officials' inability to get ahead of the curve in dealing with the continent's debt crisis remains a key liability for the euro, and likely one that will keep it vulnerable well into 2011," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.
The euro remained under pressure after EU leaders last week failed to produce a permanent financial safety net for the region's weaker economies.
The euro fell to 1.2678 Swiss francs on EBS trading platform, its weakest since the euro's launch in 1999. The Swiss currency was helped by safe-haven buying.
The euro was down 0.50% at $1.3114 against the dollar, which was up against a basket of major currencies. The U.S. Dollar Index up 0.35% at 80.655.
Against the Japanese yen, the dollar was down 0.31% at 83.69.
The flight to safety pushed gold up for a second day, as the metal overcame weakness in the euro after a warning from the European Central Bank on the region's finances encouraged light safe-haven flows into bullion.
Spot gold prices rose $2.79 to $1,377.40 an ounce.
U.S. stock indexes turned negative in early trading, weighed by declines in the information technology sector, while crude prices also edged lower.
The Dow Jones industrial average was down 22.56 points, or 0.20%, at 11,469.35. The Standard & Poor's 500 Index was down 0.40 point, or 0.03%, at 1,243.51. The Nasdaq Composite Index was down 5.43 points, or 0.21%, at 2,637.54.
Weaker equities provided pressure on oil prices as the front-month January crude contract approached expiration.
U.S. light sweet crude oil fell 55 cents to $87.47 per barrel.
Government debt rose. Benchmark 10-year notes last traded up 16/32 in price to yield 3.27%.