Morning Message

Monday Update

Monday 3rd April 2017

European shares swung between losses and gains this morning led by stronger commodity stocks. The ESTX 50 (-0.10%), UK markets (-0.06%) and the CAC 40 (-0.10%) all dipped in early trading, while the Dax (+0.21%) increased. European bond and currency markets are expected to be active in the opening days of the quarter, however, as ECB begins tapering the pace of its monthly asset purchases in government and agency bond markets to €60 billion a month from €80 billion. Imagination Tech slumped -70% after losing their biggest customer Apple. Lloyds Banking Group added +0.5% after the UK government said it has cut its stake in the bank to 1.97%. Banco Popular dropped -6% after saying that internal audits showed the need for some adjustment in previous accounts.

US stocks retreated on Friday as investors digested a slew of economic data. The Dow Jones Industrial Average (-0.31%), S&P 500 (-0.23%) and the Nasdaq Composite (-0.04%) all retreated. The three major US indexes posted quarterly gains of at least 4.6%. The Nasdaq also recorded its best quarterly performance since 2013 as tech stocks rose more than 12% in the period. DuPont rose +0.6% after saying it would sell its crop protection business to FMC Corp and buy its health and nutrition unit in a deal that will give DuPont about $1.6 billion. FMC’s shares jumped +12.6%. Blackberry was up +5% after reporting fourth quarter profit above expectations.

Asian shares were higher today, with Chinese markets closed for holiday, on the first trading day of the new quarter, as traders assessed news ahead of Chinese President Xi Jinping’s visit to the US. The Nikkei 225 (+0.39%), Hang Seng (+0.53%) and the S&P/ASX 200 (+0.13%) all increased. President Trump said that the US will take unilateral action to eliminate nuclear threats from North Korea, unless China intensifies pressure on Pyongyang. Toshiba plunged -5.47% after Reuters reported that the conglomerate might miss a third deadline to report its quarterly business results. Aurizon Holdings said that damage from Cyclone Debbie in Queensland could mean some rail lines used by miners, including BHP Billiton, could be closed for repairs for more than a month. Aurizon Holdings were down -1.14% and BHP Billiton slipped -0.17%.

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