In European Equity Markets stocks came off highs on Friday, as growing talk about central bank tightening in the region hit utilities and export-oriented stocks but continued to boost the heavyweight banking sector. The German blue chip index fell 0.1 percent. But the pan-European STOXX 600 index managed to end in positive territory, up 0.1 percent Eurozone banks rose 1.8 percent at a 14-month high, led by gains of more than 5 percent in Germany’s Commerzbank , Italy’s Banco BPM and Spain’s Banco Popular. BT was among top STOXX gainers, with the British telecoms group rising 4 percent after reaching a deal with regulator Ofcom to legally separate its Openreach network division.
In Currency Markets the dollar edged higher from two-week lows on Monday, recovering after Friday’s bout of profit-taking following a robust U.S. jobs report, as investors looked to this week’s Federal Reserve’s policy meeting in which it is expected to raise rates by a quarter percentage point. In late morning trading, the dollar was slightly higher against a basket of currencies at 101.31 and was marginally up against the euro. The single European currency was last at $1.0664. Sterling, as a result, held gains against the dollar rising 0.5 percent to $1.2229. Against the yen, the dollar fell 0.1 percent to 114.68 yen.
In Commodities Markets oil hovered around three-month lows on Monday, as rising inventories and drilling activity in the United States, the world’s top energy consumer, offset optimism over OPEC’s efforts to restrict crude output and reduce a global glut. Brent crude futures fell 7 cents to $51.30 a barrel, having earlier hit a session low of $50.85, its lowest level since Nov. 30. U.S. West Texas Intermediate crude fell 20 cents to $48.29 a barrel, a 0.4 percent loss. Spot gold was down 0.1 percent at $1,203.4 an ounce. Silver slid 0.4 percent to $16.95 an ounce, platinum lost 0.1 percent to $940.6 an ounce and palladium rose 0.9 percent to $750.5 an ounce.
In US Equity Markets the S&P 500 and the Dow Jones Industrial Average were slightly lower on Monday as gains in financials stocks – ahead of a widely expected interest rate hike – were weighed down by losses in drug stocks. The Dow Jones Industrial Average was down 0.23 percent, at 20,855.82, the S&P 500 was down 0.1 percent, at 2,369.9 and the Nasdaq Composite was up 0.15 percent, at 5,870.31. Mobileye jumped nearly 30 percent after chipmaker Intel agreed to buy the driverless technology maker for $15.3 billion. Intel’s shares were off 0.6 percent. Nutritional supplements maker Herbalife rose 2.3 percent to $53.45 after billionaire investor Carl Icahn raised his stake to 24.57 percent.
In Bond Markets U.S. Treasury yields edged higher on Monday in anticipation of a Federal Reserve interest rate increase on Wednesday, nervousness that the central bank could indicate a more aggressive pace of future rate hikes, and new corporate bond supply. Prices for benchmark 10-year Treasuries were last down 2/32 to yield 2.589 percent, from a yield of 2.582 percent late on Friday. Germany’s 10-year government bond yield was down 2 basis points at 0.47 percent, pulling back from five-week highs just shy of 0.50 percent.