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Asian Markets at Close Report

European Markets at Close Report

May 23, 2017

Asia, Europe & U.S. Stock Markets' Closing Reports Summary on May 23, 2017 on May 23, 2017

ASIA

Cheang Ming

Asian markets closed mostly lower after trading sideways for most of Tuesday, despite major Wall Street indexes closing in the green, as news of a deadly bombing at a concert venue in Manchester weighed sentiment.
Kazuhiro Nogi | AFP | Getty Images
Twenty-two people were reported dead following a blast at the Manchester Arena in northern England where U.S. singer Ariana Grande had been performing. The U.K. police are treating the blast as a terrorism incident.
The safe-haven yen climbed after news of the bombing. The dollar was fetching as little as 110.84 yen, down from around 111.34 yen earlier. At 2:55 p.m. HK/SIN, the dollar was fetching 111.02 yen.
The British pound also slipped after the news, fetching as little as $1.2983, off a high of $1.3005 earlier. The pound last traded at $1.2970.
Against the yen, the pound slipped to trade at 143.96 yen.
"Pound/yen fell to a two-session low following reports of the blast, although volatility surrounding the reaction does not yet suggest the downside will be of great magnitude. This may change if the story evolves, but at the time of writing, pound/yen is trading well within its typical range, compared with its three-month average," ThinkMarkets Senior Market Analyst Matt Simpson told CNBC.
FTSE futures, which traded at 7,478.5 before the blast, was mostly stable, trading at 7,482.5 at 9:45 a.m. HK/SIN.
"There has been little response to this awful event by the FTSE futures markets. This reflects the market view that these terrorist events are now an ongoing risk. Each individual terrorist event is unlikely to lead to any significant disruption to commerce or financial markets," CMC Markets Chief Market Analyst Ric Spooner told CNBC in an email.



 

NIKKEI NIKKEI 19613.28
---
UNCH 0%
HSI HSI 25403.15
11.81 0.05%
ASX 200 S&P/ASX 200 5760.19
---
UNCH 0%
SHANGHAI Shanghai 3061.72
-13.95 -0.45%
KOSPI KOSPI Index 2311.74
---
UNCH 0%
CNBC 100 CNBC 100 ASIA IDX 7549.10
-13.58 -0.18%
The Nikkei 225 closed 0.33 percent, or 65 points, lower at 19,613.28 on Tuesday, while the ASX 200 shed 0.19 percent, or 11.005 points, to finish the session at 5,760.2.
South Korea's benchmark Kospi index closed in the green, ending higher by 0.33 percent, or 7.71 points, at 2,311.74.
Hong Kong's Hang Seng Index reversed earlier gains to trade lower by 0.22 percent by 3:00 p.m. Mainland China markets closed the session lower, with the Shanghai Composite down 0.45 percent, or 13.9514 points, at 3,061.7242, and the Shenzhen Composite tumbling 2.12 percent, or 38.7526 points, to close at 1.789.4676.
HNA Group is negotiating a stake in Hong Kong-listed Value Partners Group, an asset management company, according to reports. Shares of Value Partners were down 4.84 percent.
Cathay Pacific denied a report from the South China Morning Post that the airline would cut 200 more jobs than the original 600 it said it would cut on Monday.
"The number of redundancies resulting from the transformation programme is around 600, as we announced to our people and the public yesterday. Rumors of other figures are incorrect," a spokesperson from Cathay Pacific told CNBC in an email.
Cathay shares were softer, trading down by 1.21 percent at 2:50 p.m. HK/SIN.
In Singapore, trade of Noble Group was halted after shares of the company fell almost 32 percent. Shares of the company sank after S&P Global Ratings downgraded the commodity trader's credit rating to CCC-plus. Reuters also reported, citing sources, that Sinochem had decided to stop pursuing a stake in the company due to Noble's shaky outlook.
In other currency news, the dollar gained against a basket of currencies. The dollar index last traded at 97.027, off the six-month low it reached in the last session.
Meanwhile, the common currency hit a six-month high in the previous session following comments from the German Chancellor Angela Merkel about euro weakness.
She said that her country's huge trade surplus was due to a "too weak" euro, Reuters reported.
The euro traded at $1.229 at 2:50 p.m. HK/SIN.
Oil prices declined after rising to a one-month high in the last session on hopes that OPEC-led output cuts could be further deepened. Benchmark Brent crude fell 0.85 percent to trade at $53.41 a barrel and U.S. crude declined 0.84 percent to trade at $50.70.
In economic news, Singapore CPI data for the month of April increased by 0.4 percent on year, compared with the 0.7 percent forecast in a Reuters poll. The lower-than-expected inflation figures were attributed in part to declining rents.
Stateside, equities gained across the board in the last session as tech and defense stocks made substantial gains.
 
EUROPE 
 
Silvia Amaro, Alexandra Gibbs

European bourses closed mostly in positive territory on Tuesday, on the back of a solid set of economic data for the euro zone.
The pan-European Stoxx 600 finished the session up 0.22 percent, with most sectors closing in the black. The U.K.'s FTSE 100 failed to hold onto gains, ending 0.15 percent down, while Germany's DAX popped 0.31 percent.
This positive sentiment in Europe followed economic data showing the euro zone keeping up a strong growth rate. The May flash composite PMI stood at 56.8, matching the six-year high registered in the previous month.
In particular, the French private sector rose to a six-year high in May supported by the election of President Emmanuel Macron. This boosted the French CAC 40, which closed up 0.47 percent, and banking shares, which closed up 0.79 percent as a sector.
However, the technological sector topped the leader board on Tuesday, after Nokia and Apple reached an agreement over their intellectual property dispute and agreed a multi-year license. Nokia was crowned the STOXX 600's best performer, ending 6.43 percent higher.
Looking at individual stocks, French media firm Vivendi jumped 1.81 percent following a Wall Street Journal report, which stated that the company could float a minority stake in Universal Music Group.
On the other hand, the Swiss firm Clariant dropped 2.55 percent on Tuesday as shares took a breather after strong gains seen on Monday. This followed news that it would merge with Huntsman Corp creating a chemical giant worth around $14 billion.
Total Votes:
Not a Scientific Survey. Results may not total 100% due to rounding.
British retailer Marks and Spencer finished almost 2 percent down after a survey from the Confederation of British Industry said retail sales growth faded away in May as inflation rises.
Elsewhere, easyJet jumped 2.5 percent after RBC raised its target price on the stock and upgraded it to "sector perform", while Deutsche Bank cut its price target on Petrofac, which saw the oilfield services provider shares fall 2.16 percent.

Manchester attack 

At least 22 people have died and several have been injured aftera blast at an Ariana Grande concert in the north of the U.K.
The terrorist attack weighed on the U.K. sterling on Tuesday and led Prime Minister Teresa May to suspend her election campaign ahead of the June 8 election. Travel and leisure was one of the few sectors to end in the red.
Meanwhile, finance ministers of the euro zone failed to reach an agreement with the International Monetary Fund over debt relief for Greece. Eurogroup President Jeroen Dijsselbloem, who chaired the meeting Monday, said that an agreement is close and that they will return to it at their next scheduled meeting.
Elsewhere, oil prices fluctuated between gains and losses on Tuesday ahead of an OPEC meeting this week, as President Donald Trump's plan to sell off half the U.S.' huge oil stockpile weighed on sentiment.

U.S. 
 
Fred Imbert

Stocks closed higher on Tuesday as hope around the Trump trade was renewed among investors.
The Dow Jones industrial average rose about 45 points higher with Goldman Sachs contributing the most gains.
The S&P 500 also ended higher and nearly erased the losses suffered from the biggest sell-off of the year. The index rose 0.2 percent to come about 2 points of closing above the Tuesday, May 16, close of 2,400.67.
The Nasdaq composite eked out a small gain despite Apple slipping. But the three major indexes notched a four-day winning streak, extending their bounce following the biggest sell-off of the year.
Last Wednesday, stocks dropped more than 1 percent on the back of fears that Trump's pro-growth agenda may be in danger. Reports that Trump allegedly tried to influence a federal investigation sent shivers down Wall Street.
"As we get temporary spikes in volatility, ... these will continue to be buying opportunities because the fundamentals have been so strong," said Randy Frederick, vice president of trading and derivatives at Charles Schwab, noting that the latest earnings season exceeded expectations and economic data remained solid.
Traders work on the floor of the New York Stock Exchange.
Getty Images
Traders work on the floor of the New York Stock Exchange.
Wall Street kept an eye on Trump's first trip overseas since taking office. The president met with Palestinian President Mahmoud Abbas and also met with Israeli Prime Minister Benjamin Netanyahu. The U.S. president will be in Europe for the rest of his trip.
Trump's "trip overseas is definitely helping. Not so much so because of what he's done, but because he is tied up and doesn't have time to cause problems," said Schwab's Frederick.
Investors also paid attention to the White House's proposed budget for next year. In it, the White House is seeking to cut federal spending by $3.6 trillion over the next 10 years.
The budget also assumes the administration will be able to lower taxes for businesses and households. The potential of lower taxes has been a boon for stocks since Trump's election, along with possible deregulation and infrastructure spending, as the major indexes have broken into record territory.
"Most of the rhetoric out of the budget and Trump's trip overseas has not been negative," said Jeff Zipper, managing director of investments at the Private Client Reserve of U.S. Bank. "It's positive that Washington is discussing his agenda. We'll see how much of that gets passed."
But traditional safe havens have caught a bid recently. The benchmark 10-year note yield falling to around 2.28 percent from its highest levels near 2.62 percent as investors prepared for the possibility that tax reform may not come as soon as previously thought.
Gold prices have also risen. The metal's 50-day moving average crossed above its 200-day moving average on Monday, potentially signaling more gains.
In Europe, stocks traded mostly higher despite an attack that killed at least 22 people and injured dozens at an Ariana Grande concert in Manchester.
The terrorist attack has dragged sterling marginally lower and led Prime Minister Teresa May to suspend her election campaign ahead of the June 8 election.
"It's a good thing that financial markets are holding up on the back of these attacks because if people panicked then it could be a bigger incentive for terrorists to attack more," said Nick Raich, CEO of The Earnings Scout.
In economic news, new home sales fell 11.4 percent in April to a seasonally adjusted annual rate of 569,000. Economists polled by Reuters had forecast new home sales would decrease by 1.5 percent to 610,000 units.
Historically, such large misses in new home sales have led to trouble for stocks. According to Kensho, S&P returns average negative 2.86 percent a month after new home sales miss by 50,000 or more. Returns for the SPDR S&P Homebuilders ETF (XHB) and the Consumer Discretionary Select Sector Fund ETF (XLY) fall 3.44 percent and 2.6 percent, respectively.

Later this week, the Federal Reserve will release the minutes from its May meeting, with investors hoping to get more clues about the central bank's plans for monetary policy.
"We certainly believe there will be a rate hike in June," said John Stadtler, head of U.S. Financial Services at PwC. "The June meeting gives them the opportunity to give feedback about what they are thinking."



 

DJIA Dow Industrials 20937.91
43.08 0.21%
S&P 500 S&P 500 Index 2398.42
4.40 0.18%
NASDAQ NASDAQ Composite 6138.71
5.09 0.08%
The Dow Jones industrial average rose 43.08 points, or 0.21 percent, to close at 20,937.91, with Goldman Sachs leading advancers and Home Depot lagging.
The S&P 500 gained 4.40 points, or 0.18 percent, to end at 2,398.42, with financials leading 10 sectors higher and consumer discretionary the only decliner.
The Nasdaq advanced 5.09 points, or 0.08 percent, to close at 6,138.71.
About nine stocks advanced for every five decliners at the New York Stock Exchange, with an exchange volume of 767.31 million and a composite volume of 3.196 billion at the close.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded near 10.8.
—CNBC's Silvia Amaro and Alexandra Gibbs contributed to this report.
Disclosure: CNBC's parent NBCUniversal is a minority investor in Kensho.
On tap this week:
Wednesday
Earnings: HP, Tiffany, Lowe's, Pure Storage, Bank of Montreal, Eaton Vance, JA Solar
9:00 a.m. FHFA home prices
9:45 a.m. Markit mfg. PMI
10:00 a.m. Existing home sales
2:00 p.m. FOMC minutes
6:00 p.m. Dallas Fed President Robert Kaplan
Thursday
OPEC meets in Vienna
Earnings: Medtronic, Abercrombie and Fitch, Ulta Beauty, GameStop, Nutanix, Splunk, Best Buy, Hormel Foods, Toronto-Dominion Bank , Royal Bank of Canada
8:30 a.m. Jobless claims
8:30 a.m. Advance econ indicators
4:00 a.m. New York Fed Executive Vice President Simon Potter
10:00 a.m. Fed Gov. Lael Brainard
10:00 p.m. St. Louis Fed President James Bullard
Friday
8:30 a.m. Durable goods
8:30 a.m. Q1 (second read) Real GDP
9:45 a.m. Markit services PMI
10:00 a.m. Consumer sentiment
Watch: Amazon headed to $1,000