European Close Market Briefing – 22/05/2017 – by Arjun Lakhanpal

In European Equity Markets  stocks ended a choppy session slightly lower, weighed by German stocks, as the euro rallied after comments about the shared currency by German Chancellor Angela Merkel. The Stoxx Europe 600 index fell 0.1 percent to 391.14. Aegon NV climbed 6.5 percent after the Dutch insurer said it would sell its two largest U.S. life businesses. Clariant AG shares jumped 3.5 percent after the Swiss chemicals company and Huntsman Corp reached an agreement to merge in an all-stock deal that would create a company worth about $14 billion. Royal Bank of Scotland Group PLC shares ended down 0.5 percent after the start of a High Court trial was adjourned by 24 hours after the lender reportedly doubled its settlement offer.

In Currency Markets the dollar fell to a more than six-month low against a basket of currencies on Monday, extending its losses from last week, as an uncertain U.S. political climate continues to weigh on the greenback.  The euro was up 0.23 percent against the dollar at $1.123 after hitting a high of $1.1263, earlier in the session. Meanwhile, sterling fell against the dollar after a pair of polls over the weekend showing Prime Minister Theresa May’s opinion poll lead falling back into single figures ahead of next month’s election. The dollar index, which tracks the greenback against a basket of six major rivals, was down 0.15 percent to 96.993. It fell to a low of 96.797, its lowest since Nov. 9, earlier in the session.

In Commodities Markets oil prices rose on Monday, bolstered by confidence that top exporters will this week agree to extend supply curbs, with suggestions the cuts could even be deepened. Brent crude gained 28 cents to $53.89 a barrel, with U.S. light crude up 30 cents at $50.63. Prices have risen on expectations the OPEC and other producers, including Russia, will extend for another six or nine months a deal to cut supplies by 1.8 million barrels per day (bpd). Spot gold was up 0.3 percent to $1,258.72 an ounce. In other precious metals, silver was up 1.4 percent at $17.05 an ounce, having earlier touched $17.14, its highest since May 1. Platinum rose 0.3 percent to $941.70 and palladium was 0.3 percent lower at $757.50.

In US Equity Markets stocks were higher in late morning trading on Monday, boosted by technology shares and as defense stocks rose after a multi-billion dollar arms deal between the United States and Saudi Arabia. The Dow was up 0.38 percent, at 20,884.23, the S&P 500 was up 0.30 percent, at 2,388.89 and the Nasdaq Composite was up 0.51 percent, at 6,114.86.  Ford was up 1.7 percent after the automaker named James Hackett as chief executive, responding to investors’ growing unease about its stock price and prospects. Berkshire Hathaway was up about 0.8 percent after Barron’s said on Saturday the conglomerate’s stock could see double digit gains over the next year and a half even if Chairman Warren Buffett decided to retire.

In Bond Markets U.S. Treasury yields were little changed on Monday as selling tied to this week’s government and corporate bond supply offset safe-haven bids underpinned by worries about probes into U.S. President Donald Trump’s 2016 campaign. The benchmark 10-year Treasury yield was 2.243 percent, little changed from late on Friday, while the 30-year yield was 2.907 percent, flat from Friday.