Opening Market Wrap 12/20/17: ‘gens una sumus’.

In Asian Equity Markets Japanese stocks fell on Wednesday morning as construction shares continued to be battered amid a suspected bid-rigging scandal, while Japan Display jumped on a media report the firm is discussing an investment from three Chinese panel makers.

The Nikkei index fell 0.1 percent to 22,838.52 in midmorning trade.

MSCI’s broadest index of Asia-Pacific stocks outside Japan inched up 0.1 percent.

In Greater China, the Shanghai Composite fell 0.04 percent.

The Hang Seng Index gained 0.04 percent.

Australia’s S&P/ASX200 gained 0.14 percent.

In Currency Markets the dollar was supported on Wednesday by expectations of a U.S. tax overhaul while a sharp rise in German bond yields helped to underpin the euro.

The dollar edged up 0.1 percent to 112.95 yen, having pulled away from Friday’s low of 112.035, with last week’s high of 113.75 seen as its next target.

Higher euro zone yields underpinned the euro, which inched up 0.1 percent to $1.1847, after rising 0.5 percent on Tuesday.

Against the yen, the euro stood at 133.79 yen, not far from strong resistance levels around 134.50.

Elsewhere, the Canadian dollar stood at C$1.2873 to the U.S. dollar after having hit a five-month low of C$1.2920 on Tuesday.

In Commodities Markets  oil prices inched up on Wednesday, supported by expectations of a fall in U.S. crude inventories and by the ongoing outage of the North Sea Forties pipeline system.

U.S. West Texas Intermediate crude futures were at $57.73 a barrel, up 0.3 percent, from their last settlement.

Brent crude futures were at $63.91 a barrel, up 0.17 percent. The API said on Tuesday that U.S. crude inventories fell by 5.2 million barrels in the week to Dec. 15 to 438.7 million.

Gold prices gained in Asia on Wednesday after snag in passage of US tax cuts linked to a procedural issue in the Senate kept markets on edge even as most analysts say the bill will still pass this week. Gold futures for February delivery rose 0.22 percent to $1,267.00 a troy ounce.

In US Equity Markets  stocks fell on Tuesday as excitement over the likelihood of a tax code revamp was offset by concern over its effect on years of monetary policy stimulus and the future of interest rates.

The Dow Jones Industrial Average fell 0.15 percent, to 24,754.75.

TheS&P 500 lost 0.32 percent, to 2,681.47.

TheNasdaq Composite fell 0.44 percent, to 6,963.85.

Apple fell 1.1 percent after broker Instinet downgraded the stock to “neutral,” saying the supply-demand balance for the iPhone X suggested little space to raise sales estimates for the next quarter. Wal-Mart  rose 0.9 percent after Citigroup upgraded the stock to “buy” on expectations that the retailer’s shares will rise further in 2018.

In Bond Markets the U.S. 10-year Treasury yield stood at 2.450 percent in Wednesday’s Asian trade. On Tuesday, it had set a seven-week high of 2.472 percent, nearing a seven-month peak of 2.477 percent hit in late October.

The rise was driven in part by expectations of tax reforms raising U.S. bond issuance, but many analysts said the immediate trigger was a jump in European bond yields on Tuesday, after Germany unveiled a plan to issue more 30-year debt next year.

Via Mr. Holger Zschaepitz


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