Brexit and Deutsche Bank concerns weigh on US stocks
US stocks decline on renewed Brexit concerns
US stocks retreated on Monday as investors worried about the negative impact of Brexit and consequences of Deutsche Bank crisis. The dollar strengthened after a report manufacturing activity expanded in the US in September. The live dollar index data show the ICE US Dollar Index, a measure of the dollar’s value against a basket of six major currencies, rose 0.28% to 95.718. The Dow Jones industrial average fell 0.3% to 18253.85 weighed by losses in Travelers and Procter & Gamble shares. The S&P 500 lost 0.3% settling at 2161.20 led by real estate and utilities stocks. The Nasdaq composite lost 0.2% to 5300.87. The Institute for Supply Management reported Manufacturing Index rose to 51.5% last month after falling to 49.4 in August. A reading of more than 50 indicates growth in activity. But at the same time spending on construction fell 0.7% in August with steep declines in expenditures on public projects, according to the Commerce Department. Mixed data failed to boost market sentiment undermined by UK reports overnight British Prime Minister Teresa May plans on triggering the process of leaving the European Union in late March or early April. Market participants are concerned the Brexit will negatively impact UK business investment and European economic growth. Investors will be focusing on US jobs report Friday for clues whether US economic recovery accelerates which would strengthen the case for a rate hike planned by the Federal Reserve. Today at 15:45 CET September New York ISM Index will be released. The tentative outlook is positive for dollar.
Energy shares lead European markets higher
European stocks rose the fifth straight session on Monday as energy stocks tracked oil higher. The euro and British Pound weakened against the dollar with news the UK will initiate the process of leaving the European Union in late March or early April contributing to Pound’s tumble to 3-month low. The Stoxx Europe 600 closed 0.1% higher. Oil company shares rose as oil advanced: Norwegian offshore services company Subsea 7 rallied 2.4%, France’s Total gained 0.4%. Bank shares extended losses despite alleviated concerns about a possible crisis in financial sector after reports last Friday Deutsche Bank may be able to pay $5.4 billion fine, significantly lower than the $14 billion requested by US regulators related to selling of mortgage securities. No deal was reached on Monday yet while Deutsche Bank shares weren’t trading in Frankfurt as the market was closed Monday for a German Unity holiday. British stocks rallied on Prime Minister Theresa May speech Sunday she would pursue a clean break from the European Union to regain full independence and sovereignty, planning to start the exit process in March or April. Other economic data were positive in euro-zone: the final reading of Markit’s PMI reading for euro-zone came in at 52.6 in September in line with expectations. The FTSE 100 rallied 1.2% to 6983.52. France’s CAC 40 gained 0.1%. Today at 10:30 CET September Construction PMI will be released in UK, the outlook is negative for Pound. At 11:00 CET August Producer Price Index will be published in euro-zone, the outlook is negative for euro.
European stocks rose the fifth straight session on Monday as energy stocks tracked oil higher. The euro and British Pound weakened against the dollar with news the UK will initiate the process of leaving the European Union in late March or early April contributing to Pound’s tumble to 3-month low. The Stoxx Europe 600 closed 0.1% higher. Oil company shares rose as oil advanced: Norwegian offshore services company Subsea 7 rallied 2.4%, France’s Total gained 0.4%. Bank shares extended losses despite alleviated concerns about a possible crisis in financial sector after reports last Friday Deutsche Bank may be able to pay $5.4 billion fine, significantly lower than the $14 billion requested by US regulators related to selling of mortgage securities. No deal was reached on Monday yet while Deutsche Bank shares weren’t trading in Frankfurt as the market was closed Monday for a German Unity holiday. British stocks rallied on Prime Minister Theresa May speech Sunday she would pursue a clean break from the European Union to regain full independence and sovereignty, planning to start the exit process in March or April. Other economic data were positive in euro-zone: the final reading of Markit’s PMI reading for euro-zone came in at 52.6 in September in line with expectations. The FTSE 100 rallied 1.2% to 6983.52. France’s CAC 40 gained 0.1%. Today at 10:30 CET September Construction PMI will be released in UK, the outlook is negative for Pound. At 11:00 CET August Producer Price Index will be published in euro-zone, the outlook is negative for euro.
Reserve Bank of Australia leaves policy unchanged
Asian stocks are rising today led by 0.8% gain in Nikkei as exporters advanced on weaker yen after upbeat US manufacturing report: Toyota shares rallied 1.8%, Panasonic jumped 1.9%. Australia’s All Ordinaries Index inched 0.09% higher while Australian dollar slipped as the Reserve Bank of Australia decided to keep interest rates at 1.5% today. Chinese markets are closed for holiday this week.
Asian stocks are rising today led by 0.8% gain in Nikkei as exporters advanced on weaker yen after upbeat US manufacturing report: Toyota shares rallied 1.8%, Panasonic jumped 1.9%. Australia’s All Ordinaries Index inched 0.09% higher while Australian dollar slipped as the Reserve Bank of Australia decided to keep interest rates at 1.5% today. Chinese markets are closed for holiday this week.
Oil prices are retreating on rising Iran output
Oil futures prices are inching lower today on reports Iran ramped up output and exports in September to levels almost matching a 2011 peak in shipments before international sanctions were imposed. Oil futures settled at a multi-week high on Monday on hopes the OPEC deal last week to limit crude output will help rebalance the market. The December contract for Brent gained 1.4% to $50.89 a barrel on London’s ICE Futures exchange on Monday.
Oil futures prices are inching lower today on reports Iran ramped up output and exports in September to levels almost matching a 2011 peak in shipments before international sanctions were imposed. Oil futures settled at a multi-week high on Monday on hopes the OPEC deal last week to limit crude output will help rebalance the market. The December contract for Brent gained 1.4% to $50.89 a barrel on London’s ICE Futures exchange on Monday.
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