Banks lead gains in equities; most European bonds advance
Nikkei 225 rallies to finish at highest since January 1992
European stocks followed their Asian counterparts higher, after another record close in the U.S. on Friday. The dollar drifted and Treasuries steadied as investor focus switches to this week’s central bank meetings.
The Stoxx Europe 600 edged up, with banks leading the advance as a drop in telecom and travel shares limited gains. In Asia, the Nikkei 225 reclaimed a 26-year high as stocks in Tokyo closed firmer although volumes were subdued. Equities also gained in Hong Kong and China. Most European bonds rose and the euro nudged higher. Sterling slipped as some of the promises made to clinch a breakthrough Brexit deal last week started to fray.
Market focus returns to central banks this week with the Fed expected to raise rates at its meeting on Wednesday and the European Central Bank to reveal details of plans to taper asset purchases on Thursday. The Bank of England and Swiss National Bank also meet. With the world economy heading into its strongest period since 2011, Wall Street economists are telling investors to brace for the biggest tightening of monetary policy in more than a decade. Elsewhere, oil declined to near $57 a barrel as U.S. drillers expanded the crude rig count to a three-month high. Bitcoin futures began trading in Chicago and at one point jumped as much as 25 percent.
- Fed policy makers on Wednesday are projected to raise the target range for their benchmark interest rate against a backdrop of continuing robust U.S. economic conditions, a vibrant labor market and forecasts for inflation to pick up.
- The European Central Bank, the Bank of England and the Swiss National Bank set monetary policy at their respective meetings on Thursday.
- Among top U.S. economic reports are consumer inflation on Wednesday and retail sales on Thursday.
- European lawmakers continue to debate Brexit and weigh moves on the next step, while North America Free Trade Agreement negotiators meet again.
And these are the main moves in markets:
- The Stoxx Europe 600 Index gained 0.2 percent as of 8:16 a.m. London time, the highest in more than a month.
- The U.K.’s FTSE 100 Index climbed 0.5 percent to the highest in almost two weeks.
- Germany’s DAX Index advanced 0.2 percent to the highest in more than a month.
- Japan’s Nikkei 225 Stock Average jumped 0.6 percent to the highest in about 26 years.
- The MSCI Asia Pacific Index jumped 0.6 percent to the highest in more than a week.
- The MSCI Emerging Market Index increased 0.6 percent.
- Futures on the S&P 500 Index increased 0.2 percent to 2,658.25, the highest on record.
- The Bloomberg Dollar Spot Index fell 0.1 percent.
- The euro gained less than 0.05 percent to $1.1778.
- The British pound decreased 0.1 percent to $1.3377, the weakest in almost two weeks.
- The Japanese yen increased less than 0.05 percent to 113.47 per dollar.
- The yield on 10-year Treasuries was unchanged at 2.38 percent, the highest in more than a week.
- Germany’s 10-year yield fell one basis point to 0.30 percent.
- Britain’s 10-year yield decreased two basis points to 1.257 percent.
- Japan’s 10-year yield declined less than one basis point to 0.05 percent.
- West Texas Intermediate crude fell 0.3 percent to $57.20 a barrel.
- Gold increased less than 0.05 percent to $1,249.03 an ounce.
- Copper declined 0.1 percent to $2.98 a pound.
By Adam Haigh and Cormac Mullen
— With assistance by Emi Urabe, and Joanna Ossinger
December 11, 2017, 7:25 PM GMT+11