The euro rallied from a four-month low against the dollar on Friday as investors pared bets against the single currency after a more than 3 percent drop this month...

But concerns about Greece and Spain were likely to keep it under pressure. Positioning ahead of the weekend meeting of the Group of 8 major industrialized nations and technical support also helped, traders said, as the euro approached its January low of $1.2623. Gains accelerated after a wave of stops were triggered in the euro's grind higher.

The euro tumbled to $1.2640, not far from its trough of 2012, before recovering to trade 0.5 percent higher at $1.2763. It hit a session peak of $1.2794 after stops were triggered around $1.2750.

The euro was still on track for its third straight week of losses.

The euro fell to 100.17 yen, its lowest since early February, before reversing course to trade at 100.97, up 0.3 percent on the day. The value of the dollar's net long position rose to $28.52 billion in the week ended May 15, from $20.95 billion the previous week. The dollar was down 0.4 percent against the yen at 79.02 yen after hitting a three-month low of 78.99, according to Reuters data. Traders cited stop-loss orders

below 79.00 yen and 78.80 yen, while offers were likely to cap dollar gains around 79.50.

U.S. stocks rose in early trading on Friday but were gearing up to close their worst week of the year, while Facebook's market debut could help lift battered investor sentiment. The S&P has fallen 6.7 percent so far in May, and while volatility is expected to continue, some analysts were forecasting a near-term rebound as valuations become more attractive. Shares of companies in the online social media sphere were trading lower. LinkedIn fell 0.8 percent to $104.07, Zynga dropped 2.2 percent at $8.08 and Groupon fell 1.7 percent to $12.20. The Dow Jones industrial average gained 19.68 points, or 0.16 percent, to 12,462.17. The S&P 500 Index rose 4.47 points, or 0.34 percent, to 1,309.33. The Nasdaq Composite edged up 0.66 point, or 0.02 percent, to 2,814.35. The cost to insure Spanish government debt against default hit record highs Friday, a day after Moody's cut its ratings on 16 Spanish banks, heightening fears of contagion from the Greek political crisis. Shares of Foot Locker jumped 10 percent to $30.82 after the athletic footwear retailer posted higher-than-expected quarterly results.

Gold rose more than 1 percent on Friday, on track for its largest two-day gain since October, boosted by investors' consolidation of positions ahead of the weekend and a stronger euro. The second day of gains helped bolster confidence which had been shaken by gold's fall earlier this week to a four-month low at $1,527 an ounce, near critical long-term support levels. Spot gold was up 1 percent at $1,588.96 an ounce, while U.S. gold futures for June delivery settled 1.08 percent higher at $1,591.9. That takes gold up 0.6 percent on the week, snapping two weeks of losses, and brings it back to positive territory year-to-date, with a 1.5-percent rise. Holdings of gold-backed exchange-traded funds tracked by Reuters, which issue securities backed by physical metal, edged up 76,000 ounces on Thursday, but remained under the 70-million-ounce level they slipped below a week ago. Among other precious metals, silver gained 2.18 percent at $28.64 an ounce. Spot platinum was up 0.53 percent at $1,452.75 an ounce, while spot palladium put on 0.54 percent at $601.22 an ounce. Both metals underperformed surging gold prices, with the gold:platinum ratio rising to a high of 1.09

Crude oil futures fell more than 1 percent on Friday, down for the sixth straight session, as worsening problems in Greece and Spain raised worries of contagion in the euro zone. Oil futures fell on the drumbeat from global stock markets, which erased the year's gains as investors pared holdings for safe-haven assets such as gold, on growing concerns about the euro zone debt crisis. In London, ICE July Brent crude settled at $107.14 a barrel, edging down 35 cents, or 0.33 percent, the lowest close for front-month Brent since the December 20, 2011 settlement at $106.73 and extending losses to a third straight week. In three weeks, front-month Brent has fallen $12.69, or 10.59 percent, its biggest three-week drop since the week to May 20, 2011, when prices ended 10.72 percent lower. July Brent's premium against U.S. July crude widened to $15.34, from $14.55 on Thursday, as Brent fell far less than U.S. crude. NYMEX June heating oil fell 1.90 cents, or 0.67 percent, to settle at $2.83 a gallon, dropping for the third consecutive day. In three weeks, front-month heating oil dropped 35.07 cents, or 11.03 percent. June RBOB gasoline settled at $2.8895 a gallon, up 1.13 cents, or 0.39 percent"

CHICAGO - NATO Summit (Final Day).

TOKYO - Federal Reserve Bank of Atlanta President Dennis Lockhart participates in panel before the Institute of Regulation and Risk North Asia - 1130 GMT.

ZURICH - Swiss National Bank (SNB) publishes Monthly Statistical Bulletin and Monthly Bulletin of Banking Statistics May 2012 - 0700 GMT.

WASHINGTON - Treasury Assistant Secretary for Economic Policy Jan Eberly participates in discussion," From Generation to Generation: The Past, Present and Future of National Investments" before an Urban Institute Forum.

22 MAY, TOKYO - Bank of Japan Monetary Policy Meeting (to May. 23)