European Close Market Briefing – 11/10/2017 – by A Lakhanpal

October 11, 2017 by

In European Equity Markets Spanish stocks rebounded sharply in a flat European market on Wednesday on hopes that a big political crisis in the euro zone’s fourth largest economy could de-escalate after Catalonia stopped short of declaring formal independence from Madrid. While Spain’s benchmark IBEX rose 1.3 percent, the pan-European STOXX 600 index ended flat and the euro zone blue chip index inched up 0.2 percent. Banks Sabadell and Caixabank which have moved their legal bases from Catalonia to other parts of Spain, rose 1.2 percent and 0.3 percent respectively after being severely hit this week by worries over the Crisis. GEA Group was up 5.8 percent, after hedge fund Elliott revealed a stake in the in German food-processing machinery firm.

In Currency Markets the dollar fell on Wednesday to a two-week low against a basket of currencies, ahead of the U.S. Federal Reserve’s release of the minutes on its September policy meeting where policy-makers decided to pare the central bank’s $4.5 trillion balance sheet. The euro reached a 2-week peak at $1.1858. It was last at $1.1841, up 0.3 percent from Tuesday. The single currency was also supported by expectations that the ECB would announce at its policy meeting later this month that it is winding back its 2.3 trillion euro bond-buying program.  Against the Japanese yen, the dollar traded flat at Y112.43. The dollar index, which measures the greenback against six currencies, shed 0.2 percent to 93.104 after hitting 92.961, its lowest since Sept. 26.

In Commodities Markets  oil prices were virtually flat on Wednesday as Saudi Arabia said it pumped more in September than August, even as OPEC forecast higher demand for 2018.  Brent crude futures were trading down 0.3 percent, to $56.47 per barrel. U.S. West Texas Intermediate crude futures rose 0.1 percent, to $50.99 a barrel. Saudi Arabia told the OPEC on Wednesday that it pumped 9.97 million barrels per day in September, up about 22,000 barrels per day from August, but still below its OPEC target. Spot gold was up 0.2 percent at $1,289.50 an ounce. Silver rose 0.3 percent to $17.13 an ounce. Platinum rose 0.4 percent to $932.90 an ounce after hitting a two-week high of $934.50 and palladium climbed 1.7 percent to $949.30 an ounce

In US Equity Markets  stock indexes treaded water in a narrow range on Wednesday, with slight gains in technology and consumer staple stocks offset by a decrease in financials on the eve of earnings by Wall Street banks. The Dow Jones Industrial Average was up 0.03 percent, at 22,836.9, the S&P 500 was down 0.01 percent, at 2,550.31 and the Nasdaq Composite was up 0.05 percent, at 6,590.36. The consumer staples index was up 0.23 percent, led by gain in Wal-Mart and Colgate-Palmolive, which rose more than 2 percent after SunTrust upgraded the stock to “buy”. General Electric fell about 1 percent after JPMorgan said a dividend cut was “increasingly likely” and cut its price target on the stock.

In Bond Markets U.S. Treasury prices were slightly higher on Wednesday ahead of the scheduled release of minutes from the Federal Reserve’s September policy meeting and the Treasury Department’s auctions of three-year and 10-year notes. Benchmark 10-year notes were last up 2/32 in price to yield 2.339 percent, down from 2.345 percent on Tuesday. Spain’s 10-year government bond yield fell 6 basis points to 1.64 percent.