European Open Market Briefing – 11/12/2017 – by Arjun Lakhanpal

In Asian Equity Markets Japanese stocks struggled for traction on Monday as gains in financial shares were offset by decreases in real estate and construction companies, with Obayashi Corp diving more than 8 percent. The Nikkei share average was little changed at 22,815.28 by midmorning trade after opening up 0.4 percent. The broader Topix shed 0.1 percent to 1,801.54. The MSCI’s broadest index of Asia-Pacific stocks outside Japan was up 0.4 percent, staying well above a recent two-month trough of 542.27 points. Chinese shares rallied, with the blue-chip CSI 300 index up 0.9 percent. Hong Kong’s Hang Seng index gained 0.5 percent.

In Currency Markets the dollar probed four-week highs against the yen on Monday, underpinned by expectations of higher U.S. interest rates, while bitcoin seized the spotlight as futures of the cryptocurrency began trading. Against its Japanese counterpart, the dollar edged up 0.1 percent to 113.59 yen, probing levels last touched in mid-November. The euro was steady at $1.1778, holding above its nearly three-week low of $1.1730 plumbed on Friday. Sterling was up 0.1 percent at $1.3398 but well off Friday’s high of $1.3521 hit as after a breakthrough in Brexit negotiations. The dollar index, which tracks the greenback against a basket of six major rival currencies, inched down 0.1 percent to 93.832.

In Commodities Markets  oil prices fell on Monday as last week’s rise in the U.S. rig count pointed to a further increase in American production that could undermine OPEC-led efforts to tighten markets.  U.S. WTI crude futures were at $57.14 a barrel, down 0.4 percent, from their last settlement. Brent crude futures were down 0.4 percent, at $63.15 a barrel. A statement by Kuwait’s oil minister that OPEC and other oil producers will study before June next year the possibility of exiting their global oil supply-cut agreement also weighed on prices, traders said. Spot gold was nearly unchanged at $1,248.06 an ounce and silver was down 0.2 percent at $15.80. Platinum edged up 0.1 percent to $888.80 an ounce, while palladium was 0.2 percent lower at $1,004.15.

In US Equity Markets  stocks advanced on Friday, buoyed by a solid payrolls report for November that locked in expectations for an interest rate hike from the U.S. Federal Reserve next week and raised optimism about economic prospects in 2018. The Dow Jones Industrial Average rose 0.49 percent, to 24,329.16, the S&P 500 gained 0.55 percent, to 2,651.5 and the Nasdaq Composite added 0.4 percent, to 6,840.08. Microsoft rose 2.02 percent as the biggest boost to the S&P 500. The S&P technology sector was up 0.4 percent. Alexion Pharmaceuticals  jumped 7.2 percent after a report said hedge fund Elliott Management wanted the company to take steps to boost its stock price, including by exploring a sale.

In Bond Markets U.S. Treasury yields were little changed on Friday after seesawing following the release of a U.S. jobs report that showed the economy added 228,000 jobs last month but average hourly earnings failed to meet expectations. Benchmark 10-year notes were down 1/32 in price to yield 2.38 percent. Yields initially edged down after the jobs report headline hit screens, but retraced that move shortly thereafter as traders unpacked the report. The 2-year note was little changed in price, yielding 1.80 percent.