European Open Market Briefing – 21/07/2017 – by Arjun Lakhanpal

July 21, 2017 by

In Asian Equity Markets  Japan’s Nikkei index edged down on Friday morning as investors took in the European Central Bank’s policy talk, while individual companies such as Yaskawa Electric rose on strong profit forecasts. The Nikkei lost 0.3 percent to 20,094.31 in midmorning trade. For the week, the benchmark index is on track to fall 0.1 percent. MSCI’s broadest index of Asia-Pacific stocks outside Japan, which has gained about 5 percent in the past two weeks, eased 0.2 percent on Friday. Hong Kong’s Hang Seng Index was down 0.19 percent at mid-morning to 26,690 and the Shanghai Composite was down 0.21 percent to 3,238.

In Currency Markets the dollar headed for weekly losses on Friday, wallowing at its lowest levels against the euro in nearly two years after European Central Bank chief Mario Draghi said policymakers would discuss changing its bond-buying programme in the autumn. The dollar was nearly flat on the day against the yen at 111.92, after touching an overnight low of 111.48, its lowest since June 27. The euro caught its breath at $1.1625 after climbing as high as $1.1659 on Thursday, its loftiest peak since August 2015. The euro was also nearly flat against its Japanese counterpart at 130.13 yen after rising to 130.26 on Thursday. The dollar index was flat on the day at 94.316, not far from its overnight low of 94.090.

In Commodities Markets oil prices were little changed on Friday ahead of a key meeting of major oil producing nations next week, sitting below the $50 per barrel level that was briefly breached for the first time in 6 weeks in the previous session. International benchmark Brent crude futures were down just 1 cent at $49.29 per barrel. U.S. West Texas Intermediate crude futures were at $46.91 per barrel, also down 1 cent. Spot gold rose 0.1 percent to $1,245.01 per ounce after touching a three-week high of $1,247.48 an ounce in the previous session. Silver fell 0.1 percent to $16.28 per ounce. Platinum fell 0.4 percent to $922.49 per ounce and palladium rose 0.4 percent to $845.65 an ounce

In US Equity Markets stocks ended little changed on Wall Street on Thursday as a deal between Sears and Amazon weighed on home improvement retailers while gains in Microsoft helped buoy the Nasdaq. The Dow fell 0.13 percent, to close at 21,611.78, the S&P 500 lost 0.02 percent, to 2,473.45 and the Nasdaq Composite added 0.08 percent, to 6,390.00. Retailers and appliance makers fell after Sears said it would sell its Kenmore home appliances on Amazon and integrate the brand’s smart gadgets with the online giant’s Alexa digital assistant. Qualcomm fell 4.9 percent after the chipmaker’s forecast missed estimates and several Apple suppliers filed a lawsuit accusing Qualcomm of taking additional licensing money over the assemblage of iPhones.

In Bond Markets U.S. government debt yields were little changed on Thursday as buying tied to the European Central Bank’s pledge of easy money stemming from inflation concerns faded after a poor auction of 10-year Treasury Inflation-Protected Securities. In late trading, the benchmark 10-year Treasury yield  was down 0.2 basis point at 2.266 percent. The 10-year German Bund yield also ended down at 0.531 percent, from close of 0.543 percent the day before.

Economic Calendar

  • 13:30 GMT+1 CAD CPI m/m
  • 13:30 GMT+1 CAD Core Retail Sales m/m