European Open Market Briefing – 26/09/2017 – by Arjun Lakhanpal

In Asian Equity Markets Japan’s Nikkei average fell slightly on Tuesday morning as tech shares and Apple suppliers declined, tracking their U.S. counterparts overnight, while concerns over North Korea sapped risk appetite. The Nikkei was effectively flat, down 0.1 percent at 20,377.29 by the midday break, moving away from a two-year high of 20,481.27 hit last week. Meantime, the broader Topix edged up 0.1 percent to 1,673.99.  MSCI’s broadest index of Asia-Pacific stocks outside Japan was down 0.3 percent, following tech-focused losses on Wall Street. Australian stocks were down 0.1 percent, while South Korean stocks slid 0.3 percent.

In Currency Markets the yen stood tall on Tuesday after tensions on the Korean peninsula flared-up anew amid an escalating war of words between North Korea and the United States, while the euro struggled near a four-week low versus the dollar. The dollar was 0.15 percent lower at 111.550 yen after coming off a high of 112.530 the previous day. The euro was steady at 132.340 yen after falling more than 1 percent overnight. The euro was 0.1 percent higher at $1.1857 but in close reach of $1.1832, its lowest level since Aug. 31 plumbed the previous day when it sank nearly 1 percent. The Swiss franc stood at 0.9662 franc per dollar after gaining about 0.3 percent overnight. The New Zealand dollar extended the previous day’s slide and was last down 0.2 percent at $0.7249

In Commodities Markets oil prices extended gains on Tuesday, with Brent crude hitting a 26-month high, supported by Turkey’s threat to cut crude flows from Iraq’s Kurdistan region to the outside world. London Brent crude for November delivery was up 46 cents at $59.48 a barrel after settling up 3.8 percent on Monday. U.S. crude for November delivery was up 15 cents at $52.37, after hitting $52.43, a five-month high. Spot gold was nearly unchanged at $1,310.61 per ounce, not far from Monday’s high of $1,311.50. Silver was up 0.1 percent at $17.19 per ounce. Platinum gained 0.1 percent to $939.50 per ounce and palladium rose 0.5 percent to $914.70 per ounce.

In US Equity Markets stocks fell on Monday, as a selloff in technology shares weighed heavily on the Nasdaq, while the most recent statement from North Korea’s to Washington added to a cautious tone. The Dow Jones Industrial Average fell 0.24 percent, to 22,295.75, the S&P 500 lost 0.22 percent, to 2,496.66 and the Nasdaq Composite was down 0.88 percent, to 6,370.59.  The S&P technology index slid 1.42 percent, its worst daily performance in five weeks. Tech names such as Facebook, off 4.5 percent, Microsoft, down 1.55 percent, and Apple off 0.88 percent, were among the biggest drags on the benchmark S&P 500 index. Allergan was up 3.40 percent after the drugmaker authorized a $2 billion buyback of its shares.

In Bond Markets Japanese government bonds were on solid footing on Tuesday, as futures edged up on the back of renewed tensions over the Korean peninsula amid an escalating war of words between North Korea and Washington. December 10-year JGB futures rose 0.07 point to 150.91. The benchmark 10-year JGB yield was unchanged at 0.020 percent. The U.S. benchmark 10-year Treasury yield was down 4 basis points at 2.222 percent.

Economic Calendar

• 15:00 GMT+1 US CB Consumer Confidence
• 17:45 GMT+1 US Fed Chair Yellen Speak