In the currency market, the dollar rose slightly against the euro. Late Tuesday, the euro was trading at $1.2560 vs. $1.2565 on Monday.

The greenback showed some strength on Tuesday in New York as traders turned to the safety appeal of lower-yielding currencies. The buck approached a three-month high against the euro and hovered near a six-week bet against the pound.

In economic news on Tuesday, U.S. stock indexes fell for the fifth straight session to the lowest levels in more than 12 years as home and auto sales data helped the S&P 500 close below 700 for the first time since 1996.

“Given the magnitude of this crisis we may have to eventually see very cheap levels before we bottom,” Deutsche Bank analysts said in a research note. The market’s precipitous decline to levels considered “cheap” is “not a reason to suggest an imminent sustainable bounce.”

MarketWatch reported that the Dow Jones Industrial Average fell 37.27 points, or 0.55%, to 6726.02, its fifth-straight decline and its eleventh in the past 13 sessions for its lowest close since April 21, 1997. The broad Standard & Poor’s 500 index fell 4.49 points, or 0.64%, to 696.33, its lowest close since the Oct. 10, 1996. The S&P is off 56% from its record high in October 2007. The Nasdaq Composite fell 1.84 points, or 0.14%, to 1321.01, and has lost 14% in 12 sessions. The Nasdaq is five points above its five-and-a-half year closing low recorded Nov. 20.

Meanwhile, the number of new sales contracts on existing homes fell a seasonally adjusted 7.7% in January amid job losses and weak consumer confidence, the National Association of Realtors said Tuesday. The index is now down 6.4% from a year earlier.

And finally, please enjoy some remarks made to the Senate by Big Ben Bernanke on Tuesday.

When prodded about the government’s fiscal position he responded that the enormous budget deficit, expected by him to be about $1.8 trillion this year, is unavoidable.

“We are better off moving aggressively today to solve our economic problems; the alternative could be a prolonged episode of economic stagnation that would only contribute to further deterioration in the fiscal situation,” Bernanke said.

Recent economic indicators indicate “little sign of improvement” in the economy. The rising number of workers filing for state unemployment has moved higher “suggesting that labor market conditions may have worsened further in recent weeks,” he said.

And we’ll end this section on that last statement, one of the few we’ve ever agreed with him about.

Source: Greenback Shows Some Strength