European Close Market Briefing – 24/10/2017 – by Arjun Lakhanpal

October 24, 2017 by

In European Equity Markets shares of Apple suppliers were boosted by robust results from chipmaker AMS on Tuesday, but stocks were mixed as investors awaited the ECB meeting later this week. The pan-European STOXX 600 ended the day down 0.4 percent, although the German, French, Italian and Spanish indexes all rose. AMS jumped 22 percent after reporting third-quarter sales just under expectations. Analysts said strong fourth-quarter guidance from the iPhone supplier offset the miss. Other companies exposed to the iPhone X introduction also gained, with Dialog Semiconductor up 2.8 percent and STMicroelectronics up 1.3 percent. Euro zone banks rose 1.3 percent, their strongest daily gain in more than a fortnight as Commerzbank also made strong gains.

In Currency Markets the dollar was little changed on Tuesday against a basket of currencies on speculation about possible fresh leadership at the U.S. Federal Reserve and bets that a tax cut package is on track to be enacted. The greenback hovered near a three-month high versus the yen on Tuesday, gaining 0.3 percent at 113.79 yen. The euro increased 0.2 percent to $1.1767 and rose 0.5 percent to 133.91 yen in advance of the European Central Bank’s policy meeting on Thursday. The New Zealand dollar has lost nearly 5 percent on worries that a harder stance on immigration and foreign investment under its new government would hamper economic growth. It shed 0.75 percent to $0.6913 after hitting its lowest level since May 19.

In Commodities Markets  Brent oil rose towards $58 a barrel on Tuesday after top exporter Saudi Arabia said it was determined to end a supply glut, while prices also drew support from forecasts of a further decrease in U.S. crude inventories. Brent crude was up 22 cents at $57.59 a barrel. It reached $59.49 on Sept. 26, its highest since July 2015. U.S. crude gained 34 cents to $52.24. Spot gold fell 0.5 percent to $1,275.81 an ounce, after hitting its lowest since Oct. 6 at $1,271.86 in the previous session. Silver fell 0.6 percent to $16.94 an ounce, after hitting its lowest since Oct. 9 in the previous session. Platinum lost 0.2 percent to $918.95 an ounce while palladium was unchanged at $959 an ounce.

In US Equity Markets  the blue-chip Dow Jones index was on track to record its biggest intraday percentage rise in more than a month on Tuesday, boosted by gains in industrial giants 3M and Caterpillar. The Dow was up 0.81 percent, at 23,462.51, the S&P 500 was up 0.17 percent, at 2,569.37 and the Nasdaq Composite was up 0.22 percent, at 6,601.61. The maker of Post-It Notes jumped 6.12 percent and Caterpillar 6.07 percent after the two companies reported stellar quarterly results and gave upbeat forecasts. Biogen lost 6.56 percent after reporting disappointing U.S. sales of Spinraza, a potential blockbuster drug. General Motors rose 2.50 percent after the No.1 U.S. automaker reaffirmed its full-year earnings forecast and promised to slash stocks of unsold vehicles.

In Bond Markets U.S. benchmark 10-year Treasury yields rose to their highest in more than five months on Tuesday, in line with gains in the European bond market, with a strong U.S. equity performance also adding to the overall risk appetite. In late morning trading, 10-year U.S. Treasury note prices were down 7/32, yielding 2.4 percent, up from Monday’s 2.375 percent. The 30-year bond prices fell 18/32, with a yield of 2.919 percent, down from 2.89 percent late on Monday.