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Indian Morning Briefing: Asian Markets Mostly Higher After French Poll Results

24 Apr 2017 3:00 am
 
GLOBAL MARKETS 
DJIA         20547.76  -30.95 -0.15% 
Nasdaq        5910.52   -6.26 -0.11% 
S&P 500       2348.69   -7.15 -0.30% 
FTSE 100      7114.55   -3.99 -0.06% 
Nikkei Stock 18879.81  259.06  1.39% 
Hang Seng    24098.93   56.91  0.24% 
Kospi         2168.49    3.45  0.16% 
SGX Nifty     9138.00    9.00  0.09% 
April contract 
 
USD/JPY 110.02-03  +0.88% 
Range   110.10   109.07 
EUR/USD 1.0842-45  +1.09% 
Range   1.0878   1.0727 
 
CBOT Wheat May $4.050 per bushel 
Comex Gold     $1,289.10  +0.4% 
Nymex Crude (NY) $49.55  -$1.16 
 
 
U.S. STOCKS 

U.S. stocks fell Friday but closed off the lows of the day following President Donald Trump's promise of a much-awaited tax-overhal plan and ahead of the first round of France's closely watched presidential election.

Trump told the Associated Press he would be releasing a "massive tax cut" package in the coming week. A day earlier, Treasury Secretary Steven Mnuchin said Trump's tax overhaul will be unveiled in the near future.

The S&P 500 index finished down 7.15 points, or 0.3%, at 2,348.69, after an earlier 11-point decline. Nine of the 11 main sectors finished lower. Telecoms and financial shares led losses, closing down 1.6% and 0.9%, respectively.

The Dow Jones Industrial Average closed down 30.95 points, or 0.2%, at 20,547.76, trimming what had been a 73-point retreat, with shares of both General Electric and Verizon Communications finishing down 2.4%.

The Nasdaq Composite Index retreated from the record close set Thursday, falling 6.26 points, or 0.1%, to close at 5,910.52, after having dipped below the 5,900 mark earlier in the session.

For the week, the Dow industrials rose 0.5%, the S&P 500 advanced 0.9%, and the Nasdaq surged 1.8%, following two weeks of declines.

"What's impressive ahead of the [French] election is we've been able to hold yesterday's gains so far," said Mark Kepner, managing director of sales and trading at Themis Trading. On Thursday, benchmarks rallied nearly 1%.
 
 
ASIAN STOCKS 

Markets in Asia were mostly higher after centrist French presidential candidate Emmanuel Macron won the first round of voting there and solidified his prospects of becoming France's next leader.

Mr. Macron won the first round with 23.9% of the vote, according an official tally of 96% of votes, with far-right candidate Marine Le Pen next at 21.4% and two other challengers several percentage points behind.

The results assuaged market fears of a victory for the nationalist Ms. Le Pen, who has been considered a wild card for markets.

With the final vote between the two candidates set for May 7, many in the market see a Trump-style surprise result as unlikely in France.

"We didn't think she would win, but we saw two big surprise endings last year," said Yusuke Sakai, senior trader at T&D Asset Management, referring to Donald Trump's election and the U.K.'s Brexit vote.

Amid near-1% declines for the yen, Japan's Nikkei Stock Average jumped 1.3% in early trading. But gains elsewhere were more modest, with Australia's S&P/ ASX 200 and Korea's Kospi each rising 0.4% just after markets there opened.

However, Chinese equities opened lower and quickly extended the decline--building on last week's weakness--as authorities' antispeculation drive continues to hit sentiment. The Shanghai Composite fells 1.4% and the smaller Shenzhen Composite was off 1.9%.

"They are no signs that regulators are going to ease the intensity of their campaign, so I think we are in for a period of downward correction," said Zhang Gang at Central China Securities.
FOREX 

The euro jumped sharply on Monday in Asia after polls closed in the first round of France's presidential election, with centrist former economy minister Emmanuel Macron clinching the lead.

Europe's common currency rose as much as 1.9% to $1.0935, its highest level against the dollar since November. Against the Japanese yen, the euro surged as high as 120.82, up 3.3%.
METALS 

Gold was trading lower in early Asian trading Monday after the victory of pro-European centrist Emmanuel Macron in the first round of voting in the French presidential election.

Investors are keeping an eye on U.S. President Donald Trump's announcement that he will unveil his tax plan on Wednesday. Analysts said geopolitical concerns are likely to dominate markets this week. Spot gold was recently trading $10.22 lower at $1,273.81/oz.
OIL SUMMARY 

Crude futures are edging higher early Monday but U.S.-priced oil is still under $50 as investors are concerned that the production cuts made by OPEC and Russia won't be enough to offset the accelerating output from the US, where the number of active oil rigs rose again for the 14th consecutive week. But "while productivity is lifting, it appears as though the rate of growth is slowing," said Vivek Dhar, a commodities strategist at Commonwealth Bank of Australia. He expects the OPEC-led cuts to continue into the coming months even though there are still many unknowns such as who is on board on extension of the cuts and the duration of the extension. June Nymex was recently up 11 cents at $49.72/barrel, while Brent was 14 cents higher at $52.10.
 
 
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(END) Dow Jones Newswires

April 23, 2017 23:00 ET (03:00 GMT)

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