NEW YORK, Dec. 28 (UPI) -- U.S. stock indexes fell Thursday as reports pointing to residual strength in the nation's economy raised fears about interest rates.

The Dow Jones industrial average fell 9.05 points, or 0.7 percent, to close at 12,501.052. During an afternoon rally, the Dow struck an intraday high of 12,529.

On the New York Stock Exchange, 1,451 stocks advanced and 1,828 declined on volume of more than 1.5 billion shares.

The Standard & Poor's 500 index fell 2.11, or 0.15 percent, to 1,424.73, while the Nasdaq composite index fell 5.65, or 0.23 percent, to 2,425.57.

Reports on December consumer confidence, November existing home sales and Midwest business activity were all stronger than expected, leading some traders to imagine the Fed might raise interest rates to slow economic growth.

The 10-year Treasury note fell 10/32, or $3.13 per each $1,000 invested, to yield 4.696 percent, while the 30-year note lost 16/32, yielding 4.818 percent.

The euro traded at $1.3146 from $1.3125 Wednesday and the dollar was at 118.91 yen from 118.78 yen late Wednesday.

On the London Stock Exchange, the FTSE 100 Index edged down to 6,240.90, off 0.1 percent. Japan's Nikkei 225 Index edged up 0.01 percent to finish at 17,224.81.

Euro supplants dollar in world circulation

FRANKFURT, Germany, Dec. 28 (UPI) -- The U.S. dollar bill is being usurped by the euro as the world's favorite form of cash, a report says.

The value of euro notes in circulation is likely to exceed the value of dollar bills, reaching $800 billion at current exchange rates by the end of the year, The Financial Times reported. About $759 billion in U.S. dollars was circulated in October, the latest month for which estimates exist.

The change reflects the euro's remarkable growth since the currency's launch Jan. 1, 2002, three years after the start of Europe's monetary union, the newspaper said.

The European Central Bank does not promote the use of the euro beyond its 12 member countries -- which will grow to 13 Monday with the addition of Slovenia, the former Yugoslav republic. But it has become popular in official foreign exchange reserves.

The U.S. dollar is still the world's most popular reserve currency.

Fast growth in the highest-denomination euro notes, especially the 500-euro note, has raised suspicions they are popular among criminals, the newspaper said.

Vietnam bank closes N. Korea accounts

HANOI, Vietnam, Dec. 28 (UPI) -- A Vietnamese bank ordered the immediate closure of all accounts linked to Pyongyang, North Korea.

East Asia Commercial Bank, a "correspondent bank" for customers wanting to remit money into and out of North Korea, closed all accounts of Pyongyang customers Wednesday, The Financial Times reported.

The closure was part of a "strategic cooperation" with "American partners," bank Deputy General Director Nguyen Thi Ngoc Van wrote in a letter to the affected customers.

It was not clear if the "partners" were the U.S. Treasury, seeking to enforce sanctions against North Korean entities accused of counterfeiting dollars and laundering income. Some of the accounts were reportedly denominated in euros, Hong Kong dollars and Japanese yen.

Hanoi has increasingly cooperated with Washington's crackdown on North Korean financing as Vietnam prepares to join the World Trade Organization and forge closer economic ties with the United States.

The bank has a strategic partnership with Citibank, linking their credit and bank card networks.

Iceland firm buys stake in AMR Corp. (NYSE:AAR)

REYKJAVIK, Iceland, Dec. 28 (UPI) -- An Icelandic investment firm plans to meet with American Airlines management after buying a 6 percent stake in the world's largest carrier.

Reykjavík's FL Group is the third-largest shareholder in airline parent AMR Corp., The Financial Times reported.

The company's investment and planned meeting come at a time of unprecedented flux in the U.S. airline industry, triggered by the hostile $8.3 billion offer for Delta Air Lines (NYSE:DAL) by US Airways.

FL Group Chief Executive Officer Hannes Smarason said he wants to discuss "strategic issues" with American's management team. He would not discuss what they were.

He did not say when the meeting would take place, the Financial Times said.

The Icelandic group has built a 12.82 million share stake in AMR Corp. -- a 5.98 percent interest valued at about $400 million -- over the past several weeks, it said in a U.S. Securities and Exchange Commission filing.

It is the limited-liability company's only U.S. airline investment.

American declined to comment on the investment or planned meeting, the newspaper said.