European Open Market Briefing – 10/08/2017 – by Arjun Lakhanpal

In Asian Equity Markets Japanese stocks were flat in choppy trade on Thursday morning as geopolitical concerns over North Korea’s threats of missile strikes receded. The Nikkei was flat at 19,736.72 by the midday break, after it traded in positive territory in early trade. The broader Topix fell 0.2 percent to 1,615.56. MSCI’s broadest index of Asia-Pacific stocks outside Japan fell 0.68 percent. Shanghai fell 0.3 percent and Hong Kong’s Hang Seng lost 1.3 percent. South Korea’s KOSPI was down 1 percent, hitting a two-month low to move further away from record highs set at the end of July.

In Currency Markets the Swiss franc eased versus the dollar on Thursday, but still held on to the bulk of hefty gains made the previous day as heightened tensions between the United States and North Korea sent investors looking for havens. Against the greenback, the Swiss franc eased about 0.1 percent to 0.9645 per dollar. The dollar edged up about 0.1 percent to 110.16 yen  , up from Wednesday’s low of 109.56 yen, which was the dollar’s lowest level since June 15. The New Zealand dollar fell to a near one-month low of $0.7300 after Reserve Bank of New Zealand Governor Graeme Wheeler said he would like to see the local dollar fall and noted the central bank had the capability to intervene.

In Commodities Markets oil futures inched down on Thursday despite official figures showing U.S. crude inventories fell more than expected, with an analyst saying the market had settled into a range. Brent crude was down 0.1 percent, at $52.66, after earlier trading as high as $52.80. U.S. West Texas Intermediate crude was down 3 cents at $49.52, after rising to $49.69 earlier. U.S. oil inventories fell by 6.5 million barrels last week, the government data showed, steeper than the expected decrease of 2.7 million barrels. U.S. gold futures for December delivery rose 0.2 percent to $1,281.90 per ounce on Thursday. Silver was nearly flat at $16.90 per ounce. Platinum was also almost unchanged at $971.75 per ounce and palladium prices were flat at $891.00 per ounce.

In US Equity Markets  stocks clawed back losses late on Wednesday as investors appeared to brush off geopolitical concerns after falling in the wake of U.S. President Donald Trump’s “fire and fury” warning to North Korea. The Dow Jones Industrial Average fell 0.17 percent, to end at 22,048.7, the S&P 500 lost 0.04 percent, to 2,474.02 and the Nasdaq Composite fell 0.28 percent, to 6,352.33. Six of the S&P 500 sectors ended higher. The consumer discretionary index was one of its biggest losers with a 0.47 percent decline. Disney shares closed down 3.9 percent as investors were skeptical of its plan to launch streaming services rather than rely on Netflix. Travel website operator Priceline Group Inc  fell 6.9 percent after a disappointing financial forecast.

In Bond Markets  U.S. Treasury yields fell on Wednesday, and yields on the benchmark 10-year note hit a six-week low, as escalating tensions between the United States and North Korea spurred demand for safe-haven assets such as government debt. In late trading, U.S. 10-year yields were at 2.237.  U.S. 30-year bond yields slid to a six-week trough of 2.790 percent, compared with 2.867 percent late on Tuesday. Yields were last at 2.815 percent. U.S. 2-year yields touched a low of 1.323 percent, matching a low hit four weeks ago.

Economic Calendar

• 09:30 GMT+1 UK Manufacturing Production m/m
• 13:30 GMT+1 US PPI m/m
• 13:30 GMT+1 US Unemployment Claims