European Close Market Briefing – 02/11/2017 – by Arjun Lakhanpal

In European Equity Markets declines in health and tech stocks weighed on European shares on Thursday following an outlook cut from Coloplast, as forecast-beating results from Credit Suisse and Danske Bank limited losses. The pan-European STOXX 600 index trended lower through the day after opening near two-year highs, ending the session down 0.5 percent. Earnings weighed on European shares, led by an 11.8 percent decline in Coloplast. Shares in heavyweight Swiss bank Credit Suisse rose 4.5 percent after it reported stronger-than-expected revenues. Denmark’s Danske Bank also rose, by 2.8 percent, after reporting net income above estimates and an increase in its capital ratio. Miner Randgold Resources lost 7.2 percent after reporting a 41 percent fall in third-quarter profits.

In Currency Markets the dollar fell to its lowest in a week against a basket of major currencies on Thursday after Republicans in the U.S. House of Representatives released proposals to overhaul the tax code. The euro  hit its highest level in a week against the dollar, rising to $1.1687. The dollar also hit a session low against the Japanese yen after the tax cut proposal’s release, falling to 113.55 yen. The greenback largely held its gains against the British pound, which fell more than 1 percent after the Bank of England raised interest rates for the first time in more than a decade but said it sees only gradual rises ahead. The BoE said its nine rate-setters voted 7-2 to increase its benchmark Bank Rate to 0.50 percent from 0.25 percent.

In Commodities Markets oil prices steadied near two-year highs on Thursday as some investors booked profits, traders said, but the market outlook remained upbeat as OPEC-led supply cuts tightened the market and drained inventories. Brent crude was up 0.2 percent to $60.61 per barrel. U.S. light crude was up 0.2 percent, to $54.43, almost 30 percent above its 2017-lows in June. U.S. crude oil inventories fell 2.4 million barrels last week despite a 46,000 bpd increase in production to 9.55 million bpd.  Spot gold was up 0.3 percent at $1,277.63 an ounce after touching $1,284.10, the highest since Oct. 20. Silver was down 0.2 percent at $17.09 an ounce. Platinum was down 0.4 percent to $927.50 an ounce and palladium was 0.9 percent lower at $992.60.

In US Equity Markets  stocks fell in late morning trading on Thursday as investors digested a summary of the much-awaited Republican tax-cut bill that called for a range of changes to the tax code. The Dow Jones Industrial Average was down 0.01 percent, at 23,433.71, the S&P 500 was down 0.20 percent, at 2,573.96. The Nasdaq Composite was down 0.14 percent, at 6,707.30. Facebook fell 2.4 percent and was the biggest drag on the S&P and the Nasdaq after the company warned of a rise in expenses next year. Tesla fell 7.1 percent after the electric car maker pushed back its target for volume production on its new Model 3 sedan by about three months, and reported its biggest quarterly loss ever.

In Bond Markets U.S. Treasury yields fell on Thursday with longer-dated yields hitting near two-week lows as investors await President Donald Trump’s possible announcement of Jerome Powell as the next head of the Federal Reserve. Benchmark 10-year Treasury yield was 2.349 percent, down 3 basis points on the day, while the 30-year yield was 3 basis points lower at 2.831 percent. The yield curve between five-year notes and 30-year bonds was 83.1 basis points, over 1 basis point above its flattest level last seen in late 2007 which was reached on Wednesday.