European Close Market Briefing – 06/07/2017 – by Arjun Lakhanpal

July 6, 2017 by

In European Equity Markets stocks fell on Thursday to their lowest in 11 weeks after minutes from the ECB’S latest meeting showed the central bank had left the door open to scrapping its bond-buying pledge. The pan-European STOXX 600 ended the session 0.7 percent lower. Euro zone blue chips also hit an 11-week low, while Britain’s FTSE 100 fell 0.4 percent. Italian lenders were the top performers, up 1.8 percent following a series of deals in the last two weeks that have restored confidence in the sector’s prospects. Commerzbank  also gained 3.3 percent after a Bloomberg report said that buy-out firm Cerberus was considering buying a minority stake in the German lender through purchases on the market.

In Currency Markets the dollar fell on Thursday after a round of weaker-than-expected U.S. labor market data, affirming a gradual pace for raising interest rates by the Fed. The greenback was already on the defensive after Wednesday’s issue of the Fed’s policy minutes failed to provide a clear picture of future interest rate increases. The slide extended with Thursday’s poor set of U.S. economic data. In mid-morning trading, the dollar index was down 0.4 percent at 95.954. The dollar fell 0.1 percent to 113.16 yen after rising more than 1 percent this week. The euro, meanwhile, rose 0.4 percent to $1.1397. The minutes of the ECB meeting nudged the euro higher as bond yields rose, though the single currency hemmed within recent trading ranges.

In Commodities Markets oil rose about 2 percent on Thursday, making up some of the previous session’s losses after U.S. data showed crude oil and gasoline stocks decreased more than expected, yet more analysts cut price forecasts. U.S. crude stocks fell 6.3 million barrels, the U.S. Energy Information Administration (EIA) said, citing stronger refining activity and reduced imports. That was much more than the draw of about 2.3 million barrels analysts had forecast. Brent crude futures were up $1.19 to $48.98 a barrel, a 2.5 percent gain. U.S. West Texas Intermediate crude futures were up 2.5 percent, at $46.28 a barrel. Gold pared losses and was last down 0.2 percent at $1,223.80 an ounce.

In US Equity Markets  stocks fell in late morning trading on Thursday as weak jobs data from the private sector struck a bleak tone for the critical nonfarm payrolls report due on Friday, while investors fretted about rising tension in the Korean peninsula. The Dow Jones Industrial Average was down 0.42 percent, at 21,387.68 and the S&P 500 was down 0.58 percent, at 2,418.35. The Nasdaq Composite was down 0.88 percent, at 6,097.00. Shares of Tesla fell 4.6 percent after the luxury electric carmaker’s Model S did not get the top score in certain tests by the Insurance Institute for Highway Safety. General Electric fell 1.7 percent after the European Commission accused the company of providing misleading information during a merger deal.

In Bond Markets U.S. Treasury yields rose on Thursday, with benchmark yields touching nearly eight-week highs, on the prospect of hawkish global central bank policy and as rising oil prices suggested inflationary pressures. Benchmark 10-year yields were last up the second-most on the day, with those yields touching a nearly eight-week high of 2.391 percent. U.S. five-year Treasury yields hit a more than three-month high of 1.968 percent while seven-year yields hit an eight-week high of 2.228 percent.