Europe Shares Rise While Asian Stocks Drop as Yen Gains With Oil

European equities rose while Japanese stocks led shares in Asia lower as persistent concern over market volatility helped strengthen the yen. Oil climbed back above $28 a barrel before an update on U.S. stockpiles.

The Stoxx Europe 600 Index snapped a seven-day decline while Japan’s Topix index slid to its lowest since October 2014 as a gauge of the nation’s equity volatility soared. The Straits Times Index in Singapore sank the most in three weeks while the yen strengthened a third day and gold resumed its advance. 

U.S. index futures erased gains as Vermont Senator Bernie Sanders defeated Hillary Clinton in the New Hampshire Democratic Primary, while Donald Trump prevailed over a crowded Republican field.

With equity markets reeling amid concern over the creditworthiness of European banks and the impact of oil’s decline, investors will be firmly focused on Federal Reserve Chair Janet Yellen Wednesday, as she testifies before the U.S. Congress. 

After the Bank of Japan’s surprise move into negative interest rates largely failed to assuage market jitters, she will need to calibrate her commentary carefully to avoid further fueling volatility.

Russ Koesterich, global chief investment strategist for New York-based BlackRock Inc., told Bloomberg TV. “People are getting worried about the global recession, worried about growth, which is affecting not only oil and stocks but other risky assets as well.”

Treasuries are off to their best start to a year since 1988 amid demand for safe investments, and gold is near a seven-month high. While markets in Singapore and Malaysia returned from Lunar New Year holidays Wednesday, mainland China, Hong Kong, Taiwan, South Korea and Vietnam remained closed.

Europe Futures Slip With Asia Stocks as Oil Retreats; Yen Rises

Equity-index futures fell with Asian stocks as oil extended this week’s slump. Malaysia’s ringgit weakened, while the yen gained.

Material and energy companies were the biggest decliners on Asia’s benchmark equity gauge as U.S. oil dropped as much as 2.6 percent. Malaysia’s ringgit led a retreat in high-yielding currencies. 

Standard & Poor’s 500 Index futures slipped, while Treasuries advanced. Senator Ted Cruz won the Iowa Republican caucuses in an upset over billionaire Donald Trump, while Democrat Hillary Clinton was clinging to the narrowest edge over Senator Bernie Sanders of Vermont.

Oil has erased last week’s rally as speculation U.S. stockpiles are continuing to expand reinforces concern over the global glut. The link between equity markets and crude had eased briefly as Federal Reserve Vice Chairman Stanley Fischer said the impact on the U.S. of recent market turbulence could factor into decision-making. 

The comments came in the wake of signals from central banks in Europe and Japan that they are ready to do what is needed to spur growth and after factory data underscored anxiety over China’s economy.

India joined Australia in keeping benchmark rates unchanged Tuesday. South Korean consumer prices were flat in January from the previous month, after economists projected a 0.4 percent increase, data showed.

European shares lose ground as Novartis and BASF fall

European shares lost ground on Wednesday, impacted by a drop in Swiss drugmaker Novartis and German chemicals company BASF after their weak earnings updates.

Royal Bank of Scotland also fell more than 2 percent after the bank warned its profits would be hit by a pension charge and U.S. litigation provisions, while a forecast of lower revenues from Apple impacted technology stocks.

The pan-European FTSEurofirst 300 index was down by 0.6 percent, while the euro zone's blue-chip Euro STOXX 50 index fell 0.8 percent.

Novartis fell 2.7 percent after its fourth-quarter core net income missed analyst expectations, while BASF weakened by 2.9 percent after issuing a profit warning.

European stock markets drop as oil price slides

Jan 20 European stocks dropped on Wednesday as a relentless slide in oil prices hit world markets.

The pan-European FTSEurofirst 300 index fell 2.3 percent to a 13-month low. Britain's FTSE 100 fell 1.9 percent, Germany's DAX slid 2.3 percent while France's CAC retreated by 2.2 percent.

Oil prices lost yet more ground, with U.S. crude dropping towards $27 a barrel, after the International Energy Agency, which advises industrialised countries on energy policy, warned that oil markets could "drown in oversupply" in 2016.

Shares of European oil and energy companies were among the worst performers, with Norwegian offshore driller Seadrill slumping 11.6 percent while Tullow Oil fell 6.7 percent.

"I am quite pessimistic about the equity markets for the next two to three months. I do not see a 2008-style scenario, but I do see a bear market coming," said Andreas Clenow, hedge fund trader and principal at ACIES Asset Management.

European Stock Market News - ECB's Monetary Easing

In currencies, the euro slipped 0.1 percent to fetch $1.1010 EUR= after climbing a to one-month peak of $1.1044 overnight.

The common currency, already on a bullish footing after the ECB's monetary easing last week fell well short of expectations, received a further boost after Governing Council member Ewald Nowotny suggested on Wednesday the markets were expecting too much stimulus from the central bank.

A notable mover in Asia was the Australian dollar, which soared after a report showed Australian jobs surged by 71,400 in November, pushing the unemployment rate to a 19-month low of 5.8 percent. That followed strong gains in October, making this the strongest two-month total in 28 years.

Despite questions about the reliability of the data, the Aussie jumped 0.9 percent to $0.7300.

The New Zealand dollar also advanced after the Reserve Bank of New Zealand (RBNZ) cut interest rates early on Thursday but said further easing should not be needed.

The kiwi traded at $0.6730 NZD=D4 after gaining more than one percent in response to the central bank's statement.

European stocks retreat at open

Europe's main stock markets opened lower on Friday, with London's benchmark FTSE 100 index down 0.6% at 6 357.42 points.

In the eurozone, Frankfurt's DAX 30 dipped 0.4% to 11 277.91 points and the Paris CAC 40 lost 0.6% to 4 919.01 compared with Thursday's closing level.

Soothing Fed sounds send shares, emerging markets higher

World shares and risk assets rallied and the dollar backed off highs on Thursday, after the Federal Reserve flagged a rate hike next month, but also an intention to take things slow and steady after that.

The pick-up in risk sentiment combined with the dip in the dollar .DXY gave commodities a reprieve from recent selling, with oil and gold inching higher.

European stocks also opened strongly with the FTSEurofirst 300 .FTEU3 pushed to a three-month high by more than 1 percent gains in London .FTSE, Frankfurt .GDAXI and Paris .FCHI, after Japan's Nikkei .N225 had hit a similar peak in Asia.[.T]

Minutes of the Fed's last policy meeting showed most members were ready to sanction the bank's first rise in rates in almost a decade in December as long as further moves then depended on the economy continuing to perform well.

Bond markets also seemed to get the message that the Fed was in no rush with rates with longer-term debt outperforming and the yield curve flattening noticeably. While two-year yields rose 3 basis points, those on 30-year paper actually dipped a basis point.

Yields were also lower across most of Europe and Asia. The premium offered by U.S. two-year debt over its German counterpart yawned out to 124 basis points, the fattest margin since 2006 and a positive for the dollar.

However, being long dollars has been a very crowded trade and investors decided to book some profits in the wake of the Fed minutes. Against a basket of currencies .DXY the dollar dipped 0.4 percent and away from a seven-month peak.

The euro edged up to $1.0682 EUR= and off a seven-month trough around $1.0615. The dollar also eased against the yen to 123.25 JPY=, after touching a three-month peak of 123.67.

European stock markets rally at open

European stocks rose sharply in opening trade on Tuesday, as investors continued to show resilience after Friday's deadly terror attacks in Paris.

The French capital's benchmark CAC 40 index of top companies gained 0.96% to 4 850.29 points compared with Monday's close.

Frankfurt's DAX 30 index advanced 0.91% to 10 810.92 and London's FTSE 100 jumped 1.15% to 6 216.84.

The region's markets held their ground on Monday, finishing on a flat note in nervous but volatile trade.

Most Asian stock markets advanced strongly on Tuesday, as the initial shock from the devastating Paris attacks wore off.

While Friday's carnage, which left 129 people dead, fuelled fears in the region about the effects on the already troubled European economy, confidence was buoyed by a defiant reaction around the world.

European Stock Market News - The Euro Wobbles

Euro wobbles on Portuguese risk, Aussie takes China data in stride

The euro wobbled on Wednesday as political uncertainty in Portugal weighed on the currency already bracing for further monetary policy easing from the European Central Bank.

The Australian dollar, often used as a proxy of China-related trades, took in stride data that showed industrial production growth in the world's second largest economy was roughly in line with expectations. ECONCN

The euro last stood at $1.0757 EUR=, recovering after having slid below $1.0700 for the first time in over six months overnight. On Tuesday, it fell as far as $1.0674 after breaking below Friday's trough of $1.0704.

Investors took aim at the euro after Portugal's minority government collapsed as left-wing parties ousted the ruling centre-right. It was the first such move against an elected government since the end of dictatorship in 1974.

In contrast, expectations that the Federal Reserve will hike U.S. interest rates in December for the first time in nearly a decade were keeping the greenback underpinned.

With the euro under pressure, the dollar index .DXY broke back above its post-payrolls high of 99.345 to scale a fresh seven-month peak of 99.504.

European stock markets rise at open

Europe's main stock markets rose at the start of trading on Tuesday, rebounding from the previous day's losses.

London's benchmark FTSE 100 index gained 0.47% to 6 325.01 points compared with Monday's close.

In the eurozone, Frankfurt's DAX 30 index won 0.29% to 10 846.96 points and the Paris CAC 40 climbed 0.53% to 4 937.37.

Mounting expectations that the United States will raise interest rates in December for the first time in nine years dominated world financial markets Monday, weighing on stocks but underpinning the dollar.

Asian Stock Market News - Asian Stocks Rose

Asian stocks break five-day losing streak but outlook wary

Asian stocks rose on Tuesday helped by buoyant U.S. markets and recent data that indicated the global economy may have turned a corner, though wary central banks signalled a recovery may be anything but durable.

European stocks are set to open higher with spreadbetters expecting Britain's FTSE 100.FTSE to open up 0.4 percent, Germany's DAX .GDAXI was seen 0.2 percent higher, and France's CAC 40 .FCHI up 0.3 percent.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS broke a five-day losing streak, rising 1.4 percent. While it has gained more than 11 percent since the end of September, it is still down more than 10 percent this year.

Recent gains in Asian stocks have been established on growing hopes that U.S. interest rates aren't likely to rise as quickly as previously thought, and on a growing sense of relief over China's growth numbers as evident from recent official data.

But there as signs of a potential headwind for Asia in the coming months as those factors show the two powerful global engines for world growth, namely the U.S. and China, are sputtering, likely hurting the export-led economies in the region.

Global manufacturing growth accelerated to a seven-month high in October but remained muted despite factories cutting their prices at the steepest rate since May 2013, a business survey showed on Monday.

Frederic Neumann, co-head of Asian economics at HSBC, suspects much of the improvement may be temporary, reflecting the lift from new electronics products, as manufacturers are still cutting jobs or slowing hiring, especially in China, India and South Korea.

That was evident in plenty on Tuesday with a cautious Reserve Bank of Australia holding rates but keeping the option open for further policy easing while price action largely kept within well-trod ranges, especially with Japan out on a holiday.

European Stock Market News - European Shares Higher

European shares edge up led by Renault

Telecom Italia rose sharply for a second day.

European shares edged higher in opening deals on Friday, and were set for a positive close on the month, with gainers led by car maker Renault after a rise in quarterly profits and phone group Telecom Italia on stake building news.

The pan-European FTSEurofirst 300 index was up 0.2%, while the eurozone's blue-chip Euro STOXX 50 index  also gained 0.2%.

The pan-European FTSEurofirst 300 is up more than 8% so far in October, as the European Central Bank (ECB) has signalled the possibility of stronger stimulus measures.

Renault rose 5.8% after third-quarter revenue increased 9.4%, lifted by growing business with partners Nissan and Daimler, as well as sales of its own new models in a rebounding European market.

Analysts at SocGen and Nomura lifted their target prices on Renault to €101 and €107 respectively, both keeping a buy rating on the stock.

Telecom Italia rose sharply for a second day to gain more than 3% after the founder of Iliad raised a stake in the Italian telecoms group to 15%.

But British Airways owner IAG fell 4.6% despite upgrading its 2015 profit outlook after third-quarter results beat expectations.

Global Stock Market News - Wall Street

On Wall Street overnight, U.S. indexes posted losses but were still on track for their best monthly performance in four years. 

U.S. data released overnight showed U.S. gross domestic product in July-September increased at a 1.5 percent annual rate, just shy of the consensus forecast for 1.6 percent growth and slowing from a 3.9 percent rise in the second quarter.

The U.S. central bank held policy steady on Wednesday and left the door open to hike interest rates for the first time since 2006 at its Dec. 15-16 meeting.

That signal comes amid growing anxiety over a slowdown in global growth, with signs of waning momentum in China in particular stoking volatility in global markets in recent months.

Markets in China edged higher, while shares of baby goods-related companies outperformed after China's ruling Communist Party said on Thursday it would ease family planning restrictions to allow two children for all couples.

The dollar extended losses after the BOJ policy decision, slipping to an intraday low of 120.29, and was last down about 0.1 percent at 120.99 yen JPY=. But it was still up about 0.9 percent for the month against the backdrop of divergent monetary policy expectations.

The euro's trend was similar, with the single currency up abut 0.1 percent against the dollar at $1.0988 EUR= but down about 1.7 percent for the month in which European Central Bank chief Mario Draghi took a surprisingly dovish stance that suggested further monetary easing steps were possible in December.

Crude oil futures slipped after the mixed U.S. economic data exacerbated fears of oversupply and as investors took profits following a rally, but they were still on track to end a volatile week with gains.

European Stock Market News - Euro Inched Up

Euro takes back some ground lost to dollar ahead of ECB

A picture illustration shows Euro and U.S. dollar banknotes in Sarajevo March 9, 2015.

The dollar gave back some of its overnight gains against the euro on Tuesday after hitting a 10-day high ahead of this week's European Central Bank meeting, which some investors believe could set the stage for additional stimulus later this year.

The Canadian dollar, meanwhile, edged lower against its U.S. counterpart after Liberal leader Justin Trudeau won a stunning election victory over Prime Minister Stephen Harper's Conservatives.

The euro inched up slightly to $1.1331 EUR=, after dropping as low as $1.1306 on Monday, but its gains were seen limited ahead of Thursday's ECB meeting as it comes against a backdrop of deflationary pressure.

Lower oil prices helped push euro zone consumer prices into negative territory last month, which some believe could prompt the ECB to eventually expand or extend its asset purchase program.

Many economists believe such a move would be most likely to come in December if the ECB's quarterly economic forecasts due early that month prove disappointing.

Economists polled by Reuters expect the ECB to extend its plan to buy 60 billion euros of assets a month of mostly government bonds beyond its planned end-date of September 2016.After the ECB, investors' main focus will be the U.S. Federal Reserve's policy meeting on Oct. 27-28. [FED/DIARY]

Investors remain divided about whether the U.S. central bank will deliver its first rate hike since 2006. Interest rate futures indicated on Monday that traders were pricing in a 52 percent chance of the Fed raising rates in March 2016, according to the CME Group FedWatch.