European Open Market Briefing – 12/10/2017 – by Arjun Lakhanpal

October 12, 2017 by

In Asian Equity Markets Japan’s Nikkei index scaled its loftiest peak in more than two decades on Thursday, hosted by records on Wall Street that offset weakness in oil-related shares. The Nikkei was up 0.5 percent at 20,978.56 at the end of morning trade, after earlier rising as high as 20,980.92, its highest since December, 1996. MSCI’s broadest index of Asia-Pacific stocks outside Japan was up 0.55 percent and at its highest since December 2007. South Korea’s KOSPI added 0.55 percent to mark a fresh record peak and Hong Kong’s Hang Seng scaled a decade-high.

In Currency Markets the dollar hit a two-week low versus a basket of currencies on Thursday after minutes from the U.S. Federal Reserve’s latest meeting suggested some central bankers are still concerned about persistently low inflation. The dollar fell 0.1 percent against the yen to 112.38 yen, but remained above Wednesday’s intraday low of 112.08 yen. The euro touched its highest in more than two weeks at $1.1878, and was last up 0.1 percent on the day at $1.1874. The dollar index, which measures the greenback’s value against a basket of six major currencies, touched 92.827, its lowest level since Sept. 26. It was last down 0.2 percent at 92.854.

In Commodities Markets  oil prices eased on Thursday as U.S. fuel inventories rose despite efforts by OPEC to cut production and tighten the market.  U.S. West Texas Intermediate crude futures were trading at $51.08 per barrel, down 0.4 percent, from their last settlement. Brent crude futures were at $56.62, down 0.6 percent, from the previous close. U.S. crude stocks rose by 3.1 million barrels to 468.5 million barrels last week, according to industry group the American Petroleum Institute (API).  Spot gold was up 0.2 percent at $1,294.29 an ounce. Silver edged up 0.1 percent to $17.18 an ounce. Platinum was 0.2 percent higher at $929.55 an ounce and palladium was unchanged at $959.10 an ounce.

In US Equity Markets  major stock indexes edged up to post record closing highs on Wednesday with sector moves in the S&P 500 showing preference toward so-called defensive stocks. The Dow Jones Industrial Average rose 0.18 percent, to end at 22,872.89, the S&P 500 gained 0.18 percent, to 2,555.24 and the Nasdaq Composite added 0.25 percent, to 6,603.55. The consumer staples sector got a boost from gains in Wal-Mart which rose 1.9 percent, as well as from Kroger, which jumped 1.2 percent after news it was exploring the sale of its nearly 800 convenience stores. General Electric fell 1.2 percent after JPMorgan said a dividend cut was “increasingly likely” and lowered its price target on the stock.

In Bond Markets U.S. Treasury prices were little changed on Wednesday after minutes from the Federal Reserve’s September meeting were in line with expectations and after the Treasury Department saw solid demand for three-year and 10-year note supply. Benchmark 10-year notes were last up 2/32 in price to yield 2.339 percent, down from 2.345 percent on Tuesday.

Economic Calendar

  • 13:30 GMT+1 US PPI m/m
  • 13:30 GMT+1 US Unemployment Claims
  • 15:30 GMT+1 EU ECB President Draghi Speaks
  • 16:00 GMT+1 US Crude Oil Inventories