Daily Market Brief [10/07/2018] - By Alphaex Capital

Alphaex Capital Daily Market Brief


European Equity Markets

Indices ended higher on Monday, as investors reacted to news that two key Brexit proponents had resigned from the British government. Despite this and the effects of Brexit, the FTSE 100 ended higher by 0.92%. The  Stoxx 600 closed up 0.58%. while the French CAC 40 traded 0.42% higher and Germany’s DAX traded up 0.38%. Air France-KLM closed higher by over 7%, after posting higher passenger numbers for June, despite several strikes.

US Equity Markets

Equities rose on Monday allowing the Dow and S&P 500 to achieve their biggest gains in more than a month, thanks to bank shares trading higher ahead of earnings reports later this week. Industrial, energy and consumer discretionary shares also rose higher, while the S&P utilities and telecommunications declined. Caterpillar Inc increased by 4.1%. The S&P 500 gained 0.88%, to 2,784.17 and the Nasdaq Composite added 0.88%, to 7,756.20.

Asian Equity Markets

The Nikkei 225 increased by 0.85%. Most sectors traded in higher today, including banks and exporters. Uniqlo owner Fast Retailing traded up by 0.84% while robotics and automation manufacturer Fanuc added 1.42%.

Forex Markets

GBP/USD stood at $1.3253 after Prime Minister Theresa May’s foreign minister and Brexit negotiator quit in protest at her plans to keep close trade ties with the European Union. The dollar’s index against a basket of six major currencies last stood at 94.088 flat for the day.

Commodities Markets

Oil prices were higher on Tuesday as growing concerns over supply shortages. Brent crude is leading the way as hundreds of oil workers in Norway were set to strike later in the day. Brent crude had added 32 cents to $78.39 per barrel following a 1.2% rise on Monday. U.S. light crude futures were up 17 cents, at $74.02. Money managers raised their bullish bets on U.S. crude in the week to July 3, the U.S. CFTC said on Monday.

Bond Markets

Treasuries yields increased on Monday as traders moved into equities and freed up cash for new Treasuries auctions this week, following a strong U.S. jobs report on Friday and a muted response to the start of U.S. tariffs on Chinese imports. The benchmark U.S 10-year note yielded 2.858 percent, up 2.7 basis points from Friday. The yield spread between 2-year and 10-year notes was at 29.50 basis points. Five-year and 30-year Treasuries were 21.50 basis points apart.

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