Dollar Rises Against Euro

BERLIN — The dollar climbed Tuesday against the euro as two leading European banks reported more fallout from the subprime lending crisis and data on the U.S. manufacturing sector beat expectations.

The 15-nation euro bought $1.5578 in afternoon European trading, more than two cents below its level of $1.5785 Monday night in New York.

The British pound fell to $1.9749 from $1.9833, while the dollar rose to 101.88 Japanese yen from 100.00 yen.

The dollar has suffered from worries about the fallout from the U.S. subprime lending crisis and the possibility of a recession. On Tuesday, however, it was two European banks that showed signs of stress.

Switzerland's UBS AG said it saw write-downs of approximately $19 billion in the first quarter, announced a large first-quarter net loss and said it would seek 15 billion Swiss francs ($15.1 billion) in new capital.

Germany's Deutsche Bank AG said it expects write-downs of 2.5 billion euros for the first quarter due to the "significantly more challenging" market conditions triggered by the subprime crisis.

In the U.S., a closely watched gauge of manufacturing activity edged up slightly in March. The Institute for Supply Management's manufacturing index was up to 48.6 points in March from 48.3 in February _ better than expected, but still showing the manufacturing sector in contraction.