Daily Note





In European Equity Markets the pan-European Stoxx 600 ended flat as sectors pointed in different directions. Retail stocks were almost 1 percent higher, while the oil and gas sector was 0.9 percent lower amid growing geopolitical tensions. Adidas topped the European benchmark on Thursday. Shares in the sportswear company pushed higher throughout the day to trade 9.6 percent to the upside following its latest earnings release. G4S fell over 2 percent after reporting a fall in its first-half profit.

In Currency Markets the US dollar rose against most major currencies on Thursday, as investors bet global trade tensions and a robust U.S. economy would continue to support the currency. Thursday’s big mover was the New Zealand dollar, which fell 1.7 percent to US$0.6636, after earlier falling to U.S.$0.6634, its lowest since March 2016. Reserve Bank of New Zealand unexpectedly committed to keeping interest rates at record lows through to 2020 on disappointing economic activity, a dovish turn that caught markets off-guard.

In Commodities Markets oil rose on Thursday, recouping some of the previous day’s steep price slide, after the first round of U.S. sanctions against Iran came into effect, although confidence in crude demand has been hit by the escalating China-U.S. trade dispute. Brent futures were up 19 cents at $72.47 barrel, after having lost more than 3 percent on Wednesday. U.S. crude futures rose 6 cents to $67.00 a barrel, having closed down 3.2 percent the day before. Crude inventories fell 1.4 million barrels in the latest week, less than half the 3.3 million-barrel draw analysts had expected.

In US Equity Markets the Dow and the S&P 500 were little changed, while the Nasdaq was firmly higher, propped up by the high-flying technology trio of Apple, Amazon and Microsoft. The S&P 500 was unchanged at 2,857.70 and the Nasdaq Composite rose 0.14 percent, at 7,899.72. Chip stocks fell after Morgan Stanley downgraded the U.S. semiconductor industry saying upside to estimates is difficult to come by. Lam Research, Micron, Applied Materials and ON Semiconductor fell between 1 percent and 4.7 percent.

In Bond Markets U.S. Treasury yields fell on Thursday in advance of a record-setting $18 billion 30-year bond sale, the final leg of this week’s $78 billion in the government’s quarterly debt refunding. The 30-year auction followed solid demand for $26 billion of 10-year notes sold on Wednesday. Earlier Thursday, a 30-year Japanese government bond auction drew firm buying from investors. The benchmark 10-year yield was more than 2 basis points lower at 2.940 percent. The 30-year yield was down 2 basis points at 3.097 percent.


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