European Close Market Briefing – 16/10/2017 – by Arjun Lakhanpal

October 16, 2017 by

In European Equity Markets Spanish stocks lagged behind a broadly flat European market on Monday as the Catalonia crisis and a profit warning from renewables energy firm Siemens Gamesa weighed. Spain’s country index IBEX fell 0.7 percent while the pan-European STOXX 600 benchmark added a symbolic 0.01 percent. Spanish banks Caixa, Sabadell and BBVA took some of the heat, falling between 1.7 and 2.8 percent but Siemens Gamesa was the top loser, down 6.3 percent after it warned on profit on Friday. Higher metal and crude oil prices supported the broader market, sending heavyweight mining stocks like Glencore, Rio Tinto and BHP up between 0.8 and 1.5 percent.

In Currency Markets the U.S. dollar was slightly stronger on Monday as investors repositioned after disappointing inflation data on Friday sent the greenback to its lowest levels in more than two weeks. The euro weakened after the Austrian election put conservative Sebastian Kurz on track to become the next leader. The euro was down 0.16 percent to $1.1803, while the dollar index rose 0.09 percent naps investors repositioned following disappointing inflation data on Friday that had sent the greenback lower. Against the Japanese yen, the dollar was steady at 111.83 yen. The Australian dollar was lower, with Aussie down 0.34 percent at $0.7868, while edged up 0.13 percent to trade at $0.7192.

In Commodities Markets  oil prices jumped 1 percent on Monday as Iraqi forces entered the oil-rich city of Kirkuk, taking territory from Kurdish fighters and briefly cutting some crude output from OPEC’s second-largest producer. Brent crude futures were up 1 percent at $57.79 per barrel. U.S. West Texas Intermediate crude was up 0.7 percent at $51.81 per barrel.  U.S. gold futures for December delivery added  0.2 percent to $1,306.80 per ounce. Silver rose 0.2 percent to $17.39 an ounce after hitting $17.46, its highest since mid-September, while platinum eased 0.2 percent to $942.05 an ounce. Palladium jumped to its highest since February 2001 at $1,010.50 an ounce, before paring gains to $1,000.90, up 1.3 percent.

In US Equity Markets  stocks crept up in late morning trading on Monday as rising Treasury yields led to a rebound in bank stocks after three straight days of losses. The Dow Jones industrial average was up 0.14 percent, at 22,903.54, the S&P 500 was up 0.07 percent, at 2,555.04 and the Nasdaq Composite was up 0.22 percent, at 6,620.27. JPMorgan and Bank of America rose about 1.5 percent, leading the gainers on the S&P financial index. Adobe lost 2.4 percent after Deutsche Bank cut rating on the Photoshop maker’s stock to “hold”. Freeport-McMoran gained 2.54 percent as copper prices broke through the $7,000-a-tonne mark for the first time in three years, helped by Chinese data.

In Bond Markets  U.S. Treasury prices fell on Monday, weighed by comments over the weekend from Federal Reserve Chair Janet Yellen, and edged lower after the release of a stronger-than-expected report on manufacturing from the New York Federal Reserve. Benchmark 10-year Treasury notes decreased 4/32 in price to yield 2.296 percent. Across the euro zone, bond yields fell 2-4 basis points, with Germany’s benchmark 10-year bond yield hitting a one-month low of 0.37 percent.