European Open Market Briefing – 06/11/2017 – by Arjun Lakhanpal

In Asian Equity Markets Japan’s Nikkei index touched a 21-year high on Monday as strong gains in the mining sector and shares such as clothing company Fast Retailing Co offset banking sector weakness. The Nikkei was up 0.01 percent at the end of morning trade at 22,541.55, after rising as high as 22,644.68, its highest intraday level since July 1996. The broader Topix edged down 0.1 percent to 1,792.42 and the JPX-Nikkei Index 400 was 0.04 percent lower at 15,897.81. The  MSCI’s broadest index of Asia-Pacific stocks outside Japan lost 0.7 percent. South Korea’s KOSPI fell 0.5 percent. Australian stocks were off 0.1 percent but stayed within striking distance of a more than two-year peak set on Friday. Hong Kong’s Hang Seng Index skidded 1 percent.

In Currency Markets the dollar touched its highest level in nearly eight months versus the yen on Monday, supported by expectations for continued monetary policy divergence between the Federal Reserve and the Bank of Japan. The dollar rose to as high as 114.735 yen at one point, its highest since mid-March, its rise having gained added steam after breaching technical resistance at levels near 114.50 yen. The euro inched up 0.1 percent to $1.1616. The dollar index, which measures the greenback against a basket of six major currencies, last stood at 94.919, trading within sight of an Oct. 27 peak at 95.150, its highest point since July 20.

In Commodities Markets  oil prices hit their highest levels since July 2015 early on Monday as markets tightened, while Saudi Arabia’s crown prince cemented his power over the weekend through an anti-corruption crackdown that included high profile arrests. Brent futures hit $62.44 per barrel early on Monday, their highest level since July 2015. U.S. West Texas Intermediate crude hit $56.00 per barrel in early trading and was at $55.79, up 0.3 percent from the last settlement.  U.S. gold futures for December delivery gained 0.1 percent to $1,269.80. Spot silver inched 0.2 percent higher to $16.84 an ounce, platinum rose 0.4 percent to $921.80, while palladium was up 0.1 percent at $998.20.

In US Equity Markets a  rise in shares of heavyweight Apple helped push up major Wall Street indexes on Friday, as investors also assessed a mixed U.S. labor market report. The Dow Jones Industrial Average rose 0.1 percent, to 23,539.19, the S&P 500 gained 0.31 percent, to 2,587.84 and the Nasdaq Composite added 0.74 percent, to 6,764.44. Shares of Apple rose 2.6 percent as shoppers streamed into the company’s stores to buy its latest iPhone. Qualcomm shares rose 12.7 percent after reports that Broadcom is exploring a deal to buy the smartphone chip maker. Broadcom shares rose 5.4 percent. American International Group shares lost 4.6 percent as investors reacted to a surprise $836 million boost to the insurance giant’s reserves.

In Bond Markets U.S. Treasury yields were little changed on Friday after the government’s jobs report for October showed that wages did not pick up in the month, raising some concerns about continuing low inflation, though recent hurricanes were seen as distorting the data. Benchmark 10-year notes gained 2/32 in price on the day to yield 2.343 percent, after falling as low as 2.323 immediately after the data. The yield curve between two-year notes and 10-year notes flattened to 71.1 basis points, the narrowest since late 2007.