Closing Markets 5 Nov.

In European Equity Markets stocks closed off their highs on Wednesday after Federal Reserve Chair Janet Yellen said a rate hike in December was a live possibility, while Germany’s blue-chip index underperformed after a scandal at carmaker Volkswagen widened. The FTSEurofirst 300 rose 0.46 percent after earlier gaining as much as 1.1 percent on the back of a fresh pledge from the European Central Bank to ramp up stimulus if necessary, while Germany’s DAX was down 0.97 percent. Top riser was commodities firm Glencore, up 5.3 percent after saying trading was strong. It said it was on track to reduce its debt and boost liquidity thanks to asset sales, and plans to deepen copper output cuts to help lift prices.
In Currency Markets the dollar rose sharply on Wednesday as remarks from Federal Reserve Chair Janet Yellen intensified bets the central bank would raise interest rates next month if the overall economy improves further. The dollar climbed more than 1 percent against the euro , notching a 3-month high, while it jumped to a 2-month high against the yen. The euro was down 0.99 percent at 1.0857, while the yen was down 0.41 percent at 121.54. The dollar index was up 0.81 percent at 97.943. Interest rates futures implied traders see a 58 percent chance of a December rate increase in the wake of Yellen’s remarks, up from 52 percent on Tuesday.
In Commodities Markets  crude oil futures fell about 3 percent on Wednesday, wiping out most of their gains from the previous day, as a strong dollar, tumbling gasoline prices and rising U.S. crude inventories bore down on the market. Brent crude futures were down 3 percent, at $49.01 a barrel and U.S. crude slid $1.30 cents, or 2.7 percent, to $46.60. Adding to bearish sentiment was an internal OPEC document published by Reuters that showed weaker demand in the next few years for oil from the producer group, even as Saudi Arabia pumped near record levels to protect its market share. U.S. gasoline futures fell more than 2 percent, buckling down from Tuesday’s 5 percent rally, despite the EIA reporting a larger-than-expected 3.3 million-barrel draw.
In US Equity Markets stocks were lower on Wednesday, following two straight days of gains, after Federal Reserve Chair Janet Yellen said a rate hike in December was a “live” possibility, but not a certainty. The S&P 500 was down 0.24 percent, at 2,104.72 and the Nasdaq Composite index was down 0.08 percent, at 5,140.97. Time Warner fell 8.5 percent after the company said ratings for its “key” domestic entertainment networks have fallen more than anticipated.  Seven of the 10 major S&P sectors were lower, with the energy sector’s 1 percent fall leading the decliners. The decline snapped a run of five straight days of gains. Chevron was down 1.4 percent and Exxon was off 0.7 percent.
In Bond Markets  U.S. two-year Treasury yields hit their highest in four and a half years on Wednesday after Federal Reserve Chair Janet Yellen said the U.S. economy was “performing well” and could justify an interest rate hike in December. U.S two-year note yields hit 0.8200 percent, their highest level since April 2011. Three-year yields hit 1.1484 percent, their highest level in four months, while five-year yields hit 1.6490 percent, their highest in roughly three months. The data reinforced expectations that Friday’s U.S. October non-farm payrolls report, which is expected to show U.S. employers added 180,000 jobs for the month, will reinforce the likelihood of a December Fed rate hike.
Regards All.

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