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May 29, 2017

Asia and Europe Stock Markets' Closing Reports on May 29, 2017

Ese Erheriene

Asia equity markets had a muted beginning to the week, with holidays set to slow activity world-wide, as investors shrugged off North Korea’s latest missile launch.
North Korea fired an unidentified projectile within about 320 kilometers of Japan’s coastline, marking the third week in a row that it has launched a missile.
“The market is quite desensitized” at this point, said Jingyi Pan, a market strategist at IG Group.
Monday’s launch occurred as markets in China and Taiwan are closed for holidays. Markets in the U.K. and U.S. will also be closed for holidays.
Read: When do markets close for Memorial Day?
There was no sign of investors seeking safety; gold GCM7, -0.10%  and currencies were little changed. Some previous North Korean missile launches caused some yen selling, but market participants have become less concerned by North Korea’s actions over time.
Hong Kong’s Hang Seng Index HSI, +0.24%  ended 0.2% higher, Japan’s Nikkei Stock Average NIK, -0.02%  closed marginally lower. Steel stocks like Nippon 5401, -3.30%   and JFE 5411, -2.76%   fell 3.3% and 2.8%, respectively, due to falling prices for their products.
Australia’s S&P/ASX 200 XJO, -0.78%   dropped 0.8%, with bank stocks continued to fall Monday.
South Korea’s Kospi index SEU, -0.10%   dropped 0.1%.
The British pound was of particular interest after it logged its biggest decline against the U.S. dollar in four months on Friday after an opinion poll showed a decline in support for the ruling Conservatives and a resurgence for the Labour Party. Other polls released over the weekend showed similar results, highlighting the prospect of Prime Minister Theresa May having a weaker hand for Brexit-related negotiations following next month’s vote. The pound GBPUSD, -0.1168%   rose to $1.2839 on Monday, up from $1.2803 late Friday in New York.
Investors are taking note of manufacturing data later this week via purchasing-managers reports and Friday’s U.S. jobs report. The latter is likely to be of “elevated in importance” with money managers using it as a gauge to guide their expectations, said Pan.

Sara Sjolin

European stocks kicked off the week in slightly negative territory on Monday, with market holidays in the U.S. and U.K. denting trading volumes.
The Stoxx Europe 600 index SXXP, -0.03%  fell 0.03% to close at 391.25, marking a third straight day of losses.
The index fell on Thursday and Friday, with oil and gas shares leading the charge lower after disappointment over OPEC’s decision to extend its production accord, but not deepen the cuts. Crude oil CLN7, +0.40%  tumbled 4.8% after the call on Thursday, but rose on Friday and continued to recover on Monday. The July contract was up 0.1% at $49.85 a barrel.
Indexes: France’s CAC 40 index PX1, -0.08%  lost 0.1% to 5,332.47, while Germany’s DAX 30 index DAX, +0.21%  ended 0.2% higher at 12,628.95.
The U.K.’s FTSE 100 index UKX, +0.40%  was closed for trading due to the spring bank holiday. U.S. stock markets were also closed for Memorial Day.
Italy’s FTSE MIB Index I945, -2.01%  slid 2% after weekend reports that an election could take place as early as September.
Read: When do markets close for Memorial Day?
Stock movers: Shares of Intesa Sanpaolo SpA ISP, -2.06%  lost 2.1% as the Financial Times reported that the Italian bank is set to close branches and cut costs in a strategy shift. Shares of other Italian banks were also lower, with UniCredit SpA UCG, -4.34%  off 4.3% and Unione di Banche Italiane SpA UBI, -4.74%  down 4.7%.
Shares of Lanxess AG LXS, +8.62%  rallied 7.9% after reports Warren Buffett has bought shares in the chemicals group.
In the U.K., British Airways said it had resumed almost all flights after a major IT outage over the weekend left all their flights leaving from Heathrow and Gatwick airports grounded.
There was no trading in shares of BA-owner International Consolidated Airlines Group IAG, -0.32% ICAGY, -1.91%  in London due to the U.K. holiday. However, the company’s Spanish-listed shares IAG, -2.78%  fell 2.8%.
Analysts at Citigroup said the outage is expected to cost IAG around 100 million euros ($111 million), comprised of €40 million in lost revenue and €60 million in customer compensation.
Read: The bill for British Airways’s IT carnage? $111 million, Citi estimates
Draghi testimony: European Central Bank President Mario Draghi said the eurozone economy still needs a “fairly substantial amount” of monetary stimulus from the ECB to help boost inflation in a sustainable way.
Testifying at the European Parliament in Brussels, Draghi acknowledged the economic recovery in the currency union, but warned that underlying inflation is still too weak.
The euro EURUSD, -0.2419%  headed south after the comments to buy $1.1171, compared with $1.1182 late Friday in New York.