European Open Market Briefing – 31/07/2017 – by Arjun Lakhanpal

In Asian Equity Markets Japan’s Nikkei index was little changed on Monday, as gains in steelmakers and other companies with upbeat earnings were offset by wariness about the yen’s creeping rise to a 1-1/2-month high against the dollar. The Nikkei stood at 19,946.32, down 0.1 percent. MSCI’s broadest index of Asia-Pacific stocks outside Japan reversed early losses to rise 0.25 percent. Chinese stocks rose, buoyed by several leading companies’ forecasts for strong mid-year earnings. The blue-chip index and the Shanghai Composite both rose 0.6 percent. Hong Kong’s Hang Seng climbed 1 percent to a two-year high.  South Korea’s KOSPI fell 0.2 percent and Australian stocks advanced 0.7 percent.

In Currency Markets the dollar struggled on Monday, wallowing near a 2-1/2-year low against the euro, weighed down by U.S. political uncertainty and uninspiring U.S. data that added to doubts about whether there will be another Federal Reserve rate hike this year. The euro was a shade lower at $1.1732  but remained in striking distance of $1.1777, its strongest level since January 2015 set on Thursday. The U.S. currency was down 0.1 percent at 110.570 yen. The pound was little changed at $1.3124 and in close reach of a 10-month high of $1.3159 scaled on Thursday.The Canadian dollar was down 0.4 percent at C$1.2477 per dollar. The dollar index was 0.2 percent higher at 93.450.

In Commodities Markets oil prices hit a two-month high on Monday, lifted by a tightening U.S. crude market and the threat of sanctions against OPEC-member Venezuela. Brent crude futures were at $52.82 per barrel on Monday, up 0.6 percent. Prices hit $52.90 per barrel earlier in the day, their highest since May 25. U.S. West Texas Intermediate futures were up 0.3 percent, at $49.87 per barrel.  U.S. gold futures for August delivery on Monday inched up 0.03 percent to $1,268.80 per ounce. Silver prices gained 0.2 percent to $16.69 per ounce. Platinum climbed 0.4 percent to $932.30 per ounce, after falling about 0.5 percent last week. Palladium advanced 0.6 percent to $882.50 per ounce

In US Equity Markets  the S&P 500 fell on Friday on negative reactions to earnings reports from high-profile names such as Amazon, Exxon and Starbucks and a decrease in shares of tobacco companies. The Dow Jones Industrial Average rose 0.15 percent, to 21,830.31, the S&P 500 lost 0.13 percent, to 2,472.1 and the Nasdaq Composite fell 0.12 percent, to 6,374.68. Amazon’s shares fell 2.5 percent after the world’s largest online retailer reported a jump in retail sales along with a profit decrease. Exxon  shares fell 1.5 percent after a rare earnings miss, while shares of rival oil major Chevron climbed 1.9 percent after its results. Starbucks lost 9.2 percent and Mattel fell 7.8 after their respective reports.

In Bond Markets U.S. Treasury yields fell on Friday after data showed that U.S. labor costs rose less than expected in the second quarter, adding to concerns that inflation will remain low. Bonds extended price gains on reports that North Korea fired a missile on Friday in an unusual late-night test launch. Benchmark 10-year notes rose 5/32 in price to yield 2.29 percent, down from 2.31 percent on Thursday.