European Open Market Briefing – 03/07/2017 – by Arjun Lakhanpal
July 3, 2017In Asian Equity Markets stocks held two-years highs on Monday, starting the new month on a solid footing after two quarters of gains while expectations of credit tightening by the world’s major central banks kept global bond markets under pressure. MSCI’s broadest index of Asia-Pacific stocks outside Japan was flat, staying within a stone’s throw of its two-year peak hit last week. Japan’s Nikkei ticked up 0.2 percent while U.S. stock futures gained 0.2 percent. Markets in greater China fell with the Hong Kong Hang Seng Index down 0.09 percent. The Shanghai Composite fell 0.16 percent.
In Currency Markets the dollar edged off from a nine-month low against a basket of currencies on Monday, but it remained shaky as signs central banks in Europe were moving away from accommodative monetary policies kept the euro and sterling well supported. The dollar added 0.1 percent to 112.435 yen after briefly falling to 111.900 earlier before climbing back quickly. The euro fell 0.1 percent to $1.1413 after reaching a near 14-month high of $1.1445 on Friday. The pound was down 0.2 percent at $1.3003 following an advance on Friday to $1.3030, its strongest since May 23. The Canadian dollar was 0.15 percent weaker at C$1.2985 per dollar. The Australian dollar was 0.15 percent lower at $0.7678.
In Commodities Markets oil prices rose on Monday, lifted by the first fall in U.S. drilling activity in months, although gains were capped by reports of rising OPEC output last month even as the group has pledged to cut supply. Brent crude futures climbed 0.3 percent, to $48.93 per barrel, after jumping 5.2 percent last week, its first weekly gain in six weeks. U.S. West Texas Intermediate crude futures rose 0.5 percent, to $46.28 per barrel, adding to last week’s 7 percent gain. Spot gold was nearly flat at $1,245.08 per ounce. It was set to end about 1 percent lower for the week, about 2 percent lower for month. U.S. gold futures for August delivery fell 0.1 percent to $1,240.80 per ounce.
In US Equity Markets major stock indexes ended a volatile week on a modestly high note on Friday, led by a rise in Nike shares, and the S&P 500 scored its biggest gain for the first half of the year since 2013 while the Nasdaq Composite’s first-half gain was its best in eight years. The Dow Jones Industrial Average rose 0.29 percent, to 21,349.63, the S&P 500 gained 0.15 percent, to 2,423.41, and the Nasdaq Composite lost 0.06 percent, to 6,140.42. Industrials were the top-performing sector, rising 0.8 percent. Nike shares rose 11 percent on Friday after the world’s largest footwear maker said it would launch a pilot online sales program with Amazon.com.
In Bond Markets Japanese government bond prices stabilised on Monday on bargain hunting following last week’s steep fall and the Bank of Japan’s regular debt-purchasing operation. The two- and five-year JGB yields were both unchanged at minus 0.120 percent and minus 0.070 percent , respectively. The benchmark 10-year yield fell 0.5 basis point to 0.080 percent after rising to a 3-1/2-month high of 0.085 percent late last week as the JGB market tracked a broad rise in yields by its global peers.
Economic Calendar
- 09:30 GMT+1 UK Manufacturing PMI
- 15:00 GMT+1 US ISM Manufacturing PMI
