Pound goes on rollercoaster ride after Brexit draft deal

NEW YORK - The British pound had a tumultuous session on Thursday as a draft Brexit deal between London and Brussels sparked both hope and skepticism in a volatile forex market.

Sterling soared to within a whisker of $1.30, striking five-month peaks, when news flashed across traders' screens that the European Union had reached a draft Brexit withdrawal deal with London.

The pound held on to most of those gains for a while, absorbing a bout of profit-taking, but then the currency plunged into negative territory when it dawned on investors that there was no guarantee of UK parliamentary backing for the agreement.

"After the initial relief that the UK government and EU have done a deal, markets are worried that it still does not have enough support to get through parliament on Saturday," independent economist Julian Jessop told AFP.

By the end of the European business day, the pound was pretty much back to where it started. It strengthened modestly after that.

Wall Street also finished higher, with analysts citing the Brexit deal despite opposition from key lawmakers that threaten its prospects.

'STILL CHANCE OF NO DEAL'

It is unclear how many of Prime Minister Boris Johnson's Conservative MPs will back the deal when he brings it to lawmakers for approval Saturday, and whether the opposition will try to vote it down or attempt to force a fresh referendum.

"There is still a chance for a no-deal Brexit – although the more likely scenario would be for the Prime Minister to follow the law and request the EU for a Brexit deadline extension, which then opens up more uncertainty," said Fawad Razaqzada at Forex.com.

Northern Ireland's hardline loyalist DUP said Thursday it was "unable to support" the draft deal.

A pre-emptive DUP announcement to the same effect issued ahead of the draft deal had already weighed on sterling, before news from Brussels gave the currency wings.

"The Brexit agreement dream has been shattered by the DUP, after reports have surfaced claiming they are still unwilling to back Johnson and his EU divorce agreement," said Sebastien Clements, a currency analyst at OFX.

While the pound stabilized late in the session, "all it takes is a leak from Westminster to restart the market chaos", he said.

EVEN WALL STREET LIKES IT

The London stock market, which usually moves in the opposite direction from sterling, enjoyed a small rise Thursday, becoming the day's star performer in otherwise lackluster European equity trading.

Wall Street also pushed higher, aided by strong earnings from Netflix and some other companies, and by optimism over Brexit.

Alan Skrainka of Cornerstone Wealth Management acknowledged there were doubts about the deal's prospects but said "this is really the first tangible sign of progress we've had in some time."

KEY FIGURES AROUND 5 A.M. FRIDAY

Pound/dollar: UP at $1.2891 from $1.2832

Euro/pound: UP at 86.31 pence from 86.29 pence

Euro/dollar: UP at $1.1127 from $1.1072

Dollar/yen: DOWN at 108.62 yen from 108.76 yen

New York - Dow: UP 0.1 percent at 27,025.88 (close)

New York - S&P 500: UP 0.3 percent at 2,997.95 (close)

New York - Nasdaq: UP 0.4 percent at 8,156.85 (close)

London - FTSE 100: UP 0.2 percent at 7,182.32 (close)

Paris - CAC 40: DOWN 0.4 percent at 5,673.07 (close)

Frankfurt - DAX 30: DOWN 0.1 percent at 12,654.95 (close)

EURO STOXX 50: DOWN 0.3 percent at 3,588.62 (close)

Tokyo - Nikkei 225: DOWN 0.1 percent at 22,451.86 (close)

Hong Kong - Hang Seng: UP 0.7 percent at 26,848.49 (close)

Shanghai - Composite: DOWN 0.1 percent at 2,977.33 (close)

Brent North Sea crude: UP 0.8 percent at $59.91 per barrel

West Texas Intermediate: UP 1.1 percent at $53.93 per barrel

source: news.abs-cbn.com

World stock markets play waiting game before Fed chief speech

NEW YORK -- Global stock markets were pressured Thursday as investors avoided risk on the eve of a speech by Federal Reserve head Jerome Powell, hotly anticipated for clues on the interest rate outlook.

The British pound, meanwhile, gained on optimism that an orderly Brexit may yet be on the cards.

"Caution is the word of the day... ahead of the key speech by the Fed chairman Jerome Powell," said analyst Naeem Aslam at trading firm ThinkMarkets.

European stocks finished solidly lower following lackluster economic data, including a report that showed Germany suffering its biggest drop in new manufacturing orders in six years.

US stocks were mixed at the end of a choppy session that included another inversion of the US Treasury market, when the return on 10-year notes fell below that of two-year notes, a worrisome development seen as sign of a possible recession.

Gregori Volokhine, fund manager at Meeschaert Financial Services, said lackluster European data and the weight from the grinding US-China trade war are weighing on sentiment.

"There's a fear of a global slowdown and a sense that a 25- or 50-basis interest rate cut won't have much effect," Volokhine said, alluding to expectations that the US Federal Reserve will cut interest rates again next month.

Investors are awaiting Powell's speech Friday at the annual central bank conference in Jackson Hole, Wyoming that some analysts expect will signal a likely interest rate cut next month.

But if his message is opaque -- which it might be given the number of regional Fed officials voicing reticence to cut again so soon -- markets could be in for a wild ride Friday.

Futures investors still overwhelmingly expect the Fed to cut interest rates in September, but 6.5 percent now see no change, which is up from zero last week.

STERLING'S BORIS BOUNCE

In foreign exchange, the British pound spiked after Prime Minister Boris Johnson met with French President Emmanuel Macron, following his talks with German Chancellor Angela Merkel the day before.

Echoing Merkel, Macron supported allowing another month to find a solution to the issue of the Irish border which has bedeviled Brexit negotiations since 2017.

But he also said the so-called Irish backstop that has caused such controversy in London was "indispensable" and all talks had to be based on the withdrawal deal negotiated by Johnson's predecessor Theresa May repeatedly rejected by the British parliament.

"The pound is pushing higher after Merkel said we can find a solution to the backstop that will maintain the integrity of the single market, and uphold the principles of the Belfast Agreement 1998. The softer stance from the EU is helping sterling," said David Madden at CMC Markets.

"Who will blink?", asked Kallum Pickering at Berenberg.

Johnson is "playing a game of chicken with the EU and moderate Conservatives" and "bets that the EU will seek a compromise at the final hour", he said.

KEY FIGURES AROUND 2040 GMT (4:40 a.m. Friday in Manila)

New York - Dow: UP 0.2 percent at 26,252.24 (close)

New York - S&P 500: DOWN 0.1 percent at 2,922.95 (close)

New York - Nasdaq: DOWN 0.4 percent at 7,991.39 (close)

London - FTSE 100: DOWN 1.1 percent at 7,128.18 (close)

Frankfurt - DAX 30: DOWN 0.5 percent at 11,747.04 (close)

Paris - CAC 40: DOWN 0.9 percent at 5,388.25 (close)

EURO STOXX 50: DOWN 0.6 percent at 3,373.67 (close)

Tokyo - Nikkei 225: UP 0.1 percent at 20,628.01 (close)

Hong Kong - Hang Seng: DOWN 0.8 percent at 26,048.72 (close)

Shanghai - Composite: UP 0.1 percent at 2,883.44 (close)

Euro/dollar: UP at $1.1086 from $1.1085 at 2100 GMT on Wednesday

Pound/dollar: UP at $1.2253 from $1.2130

Euro/pound: DOWN at 90.44 pence from 91.39 pence

Dollar/yen: DOWN at 106.42 yen from 106.62 yen

Brent North Sea crude: DOWN 0.6% at $59.92 per barrel

West Texas Intermediate: DOWN 0.6% cents at $55.35 per barrel

source: news.abs-cbn.com

World stocks slip on Trump's warning to China; sterling's slump carries on

NEW YORK -- A gauge of global stock markets fell on Tuesday as the latest round of US-China trade talks began with a threat from President Donald Trump, while concerns over a no-deal Brexit continued to drag the British currency lower.

Trump warned China against waiting out his presidency before finalizing a trade deal, saying if he wins re-election in November 2020, the outcome could be no agreement or a harsher one.

Traders are also bracing for the Federal Reserve's policy announcement on Wednesday, for which markets have already fully priced in a quarter of a percentage point rate cut. A 50 basis-point cut has a 1-in-5 chance, according to futures markets.

"If not for trade policy, we would not be using monetary policy in the way we are using it now," said Art Hogan, chief market strategist at National Securities in New York.

"The real conundrum is if, in fact, the Fed cuts rates because they are seeing a global economic slowdown and no real inflation, then the administration becomes emboldened to fight this battle longer."

Major Wall Street stock averages ended slightly lower. The Dow Jones Industrial Average fell 23.33 points, or 0.09 percent, to 27,198.02, the S&P 500 lost 7.79 points, or 0.26 percent, to 3,013.18 and the Nasdaq Composite dropped 19.72 points, or 0.24 percent, to 8,273.61.

The pan-European STOXX 600 index lost 1.47 percent and MSCI's gauge of stocks across the globe shed 0.39 percent.

Emerging market stocks lost 0.25 percent. MSCI's broadest index of Asia-Pacific shares outside Japan closed 0.09 percent lower, while Nikkei futures fell 0.7 percent.

In currencies, sterling continued to stumble against the dollar after suffering its biggest decline in eight months on Monday. Prime Minister Boris Johnson promised on Tuesday to lead Britain out of the European Union on Oct. 31 "no matter what."

Many investors say a no-deal divorce from the EU would tip Britain into a recession and inject unwanted uncertainty into financial markets.

The pound fell to as much as $1.2121, its lowest since March 2017 and was last trading at $1.215, down 0.55 percent on the day.

"Sterling is moving due to local political developments - most importantly the idea that Prime Minister Johnson may not want to meet European leaders unless they change their position, which is a more hard-line stance than the market would have expected as recently as a week ago," said Shahab Jalinoos, global head of foreign exchange strategy at Credit Suisse in New York.

The dollar index tracking the greenback against 6 major currencies rose 0.03 percent, with the euro up 0.09 percent to $1.1154.

US Treasury yields rose ahead of the Fed announcement after data showed consumer confidence rebounded in July to its strongest level since November.

Benchmark 10-year Treasury notes last fell 2/32 in price to yield 2.0597 percent, from 2.055 percent late on Monday.

In commodities trading, crude oil prices climbed as the Fed rate cut anticipation boosted demand expectations, but further price action hinges on the Fed's language.

"If the language we get from the Fed in post-meeting comments is on the conservative, rather than accommodative side, the U.S. dollar is likely to continue to remain strong and continue to present a headwind for an advance in oil," Harry Tchilinguirian, global oil strategist at BNP Paribas in London, told the Reuters Global Oil Forum.

Prices rose further after API data showed a larger-than-expected draw in U.S. crude stockpiles.

US crude rose 2.57 percent to $58.33 per barrel and Brent was last at $64.97, up 1.98 percent on the day.

Spot gold added 0.3 percent to $1,430.39 an ounce. Copper lost 1.33 percent to $5,938.00 a ton.

source: news.abs-cbn.com

Pound set for longest losing streak vs euro as Brexit plan disintegrates

LONDON - Sterling fell broadly on Wednesday and was on track for its longest ever losing streak against the euro as Prime Minister Theresa May's last-ditch Brexit plan failed to win over either opposition lawmakers or many in her own party.

With the plan appearing dead in the water, some traders said they saw a rising chance of Britain leaving the European Union without a transition deal.

The pound fell 0.3 percent to $1.2663, its lowest since mid-January, and weakened a similar amount against the euro to 88.135 pence. The sterling is set for its 13th straight day of falls against the euro, measured by London trading prices, the longest such run since the euro began trading in 1999, according to Refinitiv data.

"The action from Labour and eurosceptic Tory members was quite negative and an updated deal passing parliament looks quite distant now," said Nomura FX strategist Yujiro Goto.

"It may depend on the result of the EU parliamentary election over the weekend, but this could mean May resigns over the weekend. It was generally expected by the market, but it became clearer yesterday."

The EU parliamentary election is due to run from Thursday to Sunday, and opinion polls suggest Nigel Farage's Brexit Party will poll strongly.

In mid-March, banks informally canvassed by Reuters saw a diminishing chance of a "no-deal" Brexit.

This week though there were signs some were changing their mind, with JPMorgan upping its probability of a no-deal Brexit to 25 percent from 15 percent. Another bank, Nordea, raised the chance of no-deal Brexit to 15 percent, compared to 10 percent in March while Mizuho strategists now see no-deal chances rising towards 50 percent.

"Personally, I suggest chances of no-deal (Brexit) is nearer 50 percent given the way things are shaping up right now. Looking for lower sterling-dollar trend to continue into the EU election and beyond," said Neil Jones, head of hedge fund currency sales at Mizuho.

Others stuck to previous forecasts ranging around 15-20 percent. JPM also said it was expecting a national election and Brexit delayed to year-end.

Broader market positioning on the pound suggested more volatility in store for the British currency. Outstanding net short positions on the pound were whittled back sharply in recent weeks when hopes grew that May could secure a deal.

With positioning broadly neutral, sterling has become more vulnerable to headline-driven selloffs.

WHAT INFLATION?

Data on Wednesday showed British inflation rose last month by less than investors and the Bank of England had expected. But it still hit its highest level this year, pushed up by higher energy bills.

Yet, with politics dominating currency trading so heavily, there was barely any reaction from sterling.

Money markets now do not expect a BOE rate rise this year and are starting to price out 2020 hikes as well.

Ten-year British government bond yields slipped 3.6 basis points and their yield premium over German debt tightened to its narrowest in six weeks, implying greater demand from British investors for government bonds.

"Brexit, rather than inflation, is at the moment the key driver of interest rates. And with the uncertainties on this front growing rather than falling and no early resolution in sight, rates look set to remain firmly on hold for the time being," said Rupert Thompson, head of research at Kingswood.

(Reporting by Saikat Chatterjee and Abhinav Ramnarayan; Editing by Tommy Wilkes, Andrew Heavens and Alexandra Hudson)

source: news.abs-cbn.com

World stocks slide before corporate results, dollar gains

NEW YORK -- A gauge of global equity markets slid on Thursday as investors waited for first-quarter earnings reports, while Treasury yields rose after strong US data and a six-month extension of a deadline for Britain to leave the European Union.

The dollar index rose as worries about the world's largest economy eased after US data showed March producer prices increased by the most in five months and weekly jobless claims fell to the lowest since 1969.

The data followed a decision by EU leaders to push the Brexit deadline to Oct. 31 so that Britain would not crash out of the bloc on Friday without a treaty - though it offered scant clarity on when, how or if departure will happen.

Regional and country indexes in Europe rose but Wall Street retreated as investors awaited the first-quarter US earnings season, which starts in earnest on Friday. Profit estimates have dropped steadily in the last six months, with earnings by S&P 500 companies expected to fall 2.5 percent and mark the first year-on-year decline since 2016, according to Refinitiv data.

"The big elephant out there is earnings. Street estimates are for a year-over-year decline despite higher revenue and that's driven by a handful of large companies that are heavily weighted, so it could be a bit deceiving," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

"Often the market will just wait it out when we start to get close to earnings."

MSCI's gauge of stock market performance in 47 countries shed 0.17 percent, while the pan-European STOXX 600 index closed up 0.11 percent. France's CAC 040, Germany's DAX and Italy's MIB all rose.

European airline stocks rose, with the travel and leisure index rising 1.3 percent, after the Brexit extension. Irish stocks, which are especially sensitive to a potential hard Brexit, tacked on 0.6 percent.

Trading volume on Wall Street was the lowest so far in 2019.

The Dow Jones Industrial Average fell 14.11 points, or 0.05 percent, to 26,143.05. The S&P 500 gained 0.11 point to 2,888.32 and the Nasdaq Composite dropped 16.89 points, or 0.21 percent, to 7,947.36.

STERLING SLIPS

In currency trading, the dollar index rose 0.23 percent, with the euro down 0.14 percent to $1.1257.

The Japanese yen weakened 0.57 percent versus the greenback at 111.66 per dollar. Sterling fell 0.25 percent to $1.3056, suggesting fears remain about Brexit.

Germany's 10-year bond yield edged up after the Brexit announcement, while a signal from the European Central Bank that it will fight low economic growth and inflation boosted peripheral debt.

Germany's 10-year bond yield was up 0.02 percentage point at negative 0.01 percent.

US Treasury benchmark 10-year notes last fell 6/32 in price to yield 2.5006 percent.

Oil prices fell more than 1 percent after sources said the Organization of the Petroleum Exporting Countries may raise output from July if Venezuelan and Iranian supplies fall further and prices keep rallying.

US crude fell $1.03 to settle at $63.58 per barrel. Brent settled down 90 cents at $70.83.

Gold prices fell more than 1 percent, slipping below the key $1,300 level, as robust economic data from the United States boosted the dollar, taking the sheen off the safe-haven metal.

US gold futures settled 1.6 percent lower at $1,293.3 an ounce. 

source: news.abs-cbn.com

World stocks, oil touch 2019 highs; sterling wobbles

NEW YORK -- Stocks across the globe rose for a seventh straight session on Tuesday despite late selling on Wall Street, while the pound wobbled against the dollar as traders expected European Union officials would allow Britain a delay on Brexit.

Bets that the Federal Reserve will this week reinforce the market view that the US monetary policy tightening cycle is in the rear-view mirror have kept alive the bid on stocks, while the dollar index touched its lowest since March 1.

But trade news weighed on sentiment late in the New York trading session after Bloomberg News reported that some negotiators are worried that China is pushing back against US demands.

"Trade fear has reared its head again with Trump administration concerns (that) China is walking back some of the pledges they've made in negotiations so far," said Chris Zaccarelli, chief investment officer at Alliance in Charlotte.

Investor focus will remain on the Fed on Wednesday, particularly on whether policymakers have sufficiently lowered their interest rate forecasts to align more closely their "dot plot," which shows individual policymakers' rate views for the next three years, with market expectations.

The CitiFX US economic surprise index, which measures economic data against expectations, has been negative for over a month and earlier in March touched its lowest since August 2017.

The Dow Jones Industrial Average fell 26.72 points, or 0.1 percent, to 25,887.38, the S&P 500 lost 0.37 points, or 0.01 percent, to 2,832.57 and the Nasdaq Composite added 9.47 points, or 0.12 percent, to 7,723.95.

The pan-European STOXX 600 index rose 0.57 percent and emerging market stocks added 0.16 percent.

MSCI's gauge of stocks across the globe gained 0.16 percent.

BREXIT OPTIONS

In currency markets, sterling touched $1.3311 after slipping to as low as $1.3241 as traders expected EU officials to give Britain a delay on Brexit negotiations, though the uncertainty kept the market volatile. Sterling was last trading at $1.3264, up 0.07 percent on the day.

"The predominant notion adopted by the market is that as long as the worst-case scenario of hard Brexit is avoided by delaying Brexit, the pound is a buy on dips," Rabobank strategists said in a note.

The dollar index fell 0.12 percent, with the euro up 0.11 percent to $1.1349.

"What we are seeing is the market positioning for potentially a more dovish tone tomorrow," said Minh Trang, senior currency trader at California's Silicon Valley Bank, speaking about expectations of what the Fed's statement will be like on Wednesday.

The Japanese yen was flat versus the greenback at 111.43 per dollar.

Among commodities, oil prices were little changed after hitting 2019 highs, maintaining recent strength on the back of expectations for producer club OPEC to continue production cuts. US sanctions against producers Iran and Venezuela have also supported prices, although traders said the market may be capped by rising US output.

US crude fell 0.07 percent to $59.05 per barrel and Brent was last at $67.67, up 0.19 percent on the day.

"OPEC and non-OPEC producers are determined to get the supply and demand dynamics better into balance, recognizing that US shale production is going to continue to rise," said Andy Lipow, president of Lipow Oil Associates in Houston.

Precious metal palladium, used in things like car catalytic converters, dipped after it topped the $1,600 an ounce mark for the first time on supply concerns.

Palladium last rose 0.76 percent to $1,595.50 an ounce. Prices have nearly doubled since their mid-August lows and have surged more than 25 percent this year.

Spot gold added 0.2 percent to $1,306.31 an ounce. US gold futures gained 0.37 percent to $1,306.30 an ounce.

Copper rose 0.53 percent to $6,459.00 a tonne.

US Treasury yields zigzagged ahead of the Fed's Wednesday statement. Benchmark 10-year notes last fell 4/32 in price to yield 2.614 percent, from 2.601 percent late on Monday.

The 30-year bond last fell 9/32 in price to yield 3.0238 percent, from 3.01 percent late on Monday.

source: news.abs-cbn.com

Asia stocks follow Wall Street's negative lead

SINGAPORE - Asian stocks were mostly lower on Thursday following a subdued lead from Wall Street, while the dollar pulled up from near two-week lows and sterling languished under the weight of political fears one week before Britain's election.

MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.2 percent and looked set for its fifth straight session of losses as investors took profits after stocks hit a two-year high last week and as economic and geopolitical concerns continued to weigh on sentiment.

Japan's Nikkei advanced 0.8 percent after data showing recurring first-quarter corporate profits were the highest on record for the January to March period.

An increase in capital expenditure in the first quarter also adds to a raft of recent data pointing to economic expansion.

Manufacturing growth in Japan also rose to a three-month high, according to a business survey.

Australian stocks retreated 0.2 percent.

South Korea's KOSPI fell 0.3 percent and the Korean won weakened 0.2 percent to trade at 1,121 won to the dollar after data showed factory activity in May shrank for the 10th straight month.

Overnight, Wall Street closed slightly lower as financials lost ground after JPMorgan and Bank of America warned of revenue weakness in the current quarter, but gains in defensive plays offset the decline.

All three major US indexes ended May in positive territory.

The dollar gained after touching a near two-week low against the yen overnight.

It was up 0.2 percent from its previous close at 110.95 early on Thursday, its first positive session in five, but concerns about US politics capped gains.

President Donald Trump's administration has been the focus of independent investigations by the Federal Bureau of Investigation and several congressional panels over alleged Russian meddling in the 2016 presidential election and potential collusion by the Trump campaign.

The House intelligence committee on Wednesday approved subpoenas for Trump's former national security adviser and personal lawyer in connected with the Russian meddling probe.

The dollar index, which tracks the greenback against a basket of six major peers, inched up 0.1 percent to 97.039 after posting a 0.4 percent loss on Wednesday.

"The dollar remains pressured by the mounting dysfunction in Washington that has all but eliminated hopes for a bold fiscal stimulus package from the Trump administration," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.

Clouding the picture further was a mixed bag of economic data on Wednesday.

Pending home sales fell for a second straight month in April, hindered by a lack of supply, while an index of U.S. Midwest manufacturing activity rose in May.

Sterling retreated 0.15 percent to $1.2872 on Thursday after a YouGov poll showed Prime Minister Theresa May could lose control of parliament in Britain's June 8 election, raising the prospect of political turmoil just as formal Brexit talks begin.

Other polls, however, show May winning a big majority.

In commodities, oil prices attempted to claw back some of the losses posted on Wednesday after an increase in Libyan output helped boost monthly OPEC production for the first time this year.

Global benchmark Brent advanced 1.8 percent to $51.21 a barrel after slumping 3 percent on Wednesday.

US crude rose 1 percent to $48.82, after plunging 2.7 percent in the previous session.

Gold was steady at $1,267.91 an ounce.

source: news.abs-cbn.com

Asia stocks tread water as China manufacturing in focus

HONG KONG - Asian stocks were steady in a cautious start on Wednesday after a weak session on Wall Street, while the sterling stumbled as a new poll found British Prime Minister Theresa May's Conservative Party risks falling short of an overall majority in next month's national election.

MSCI's broadest index of Asia-Pacific shares outside Japan was flat. Early trade in Australia and Japan was mixed.

China's stock markets are in focus as they reopen after a long weekend with the official survey on manufacturing likely to set the tone for markets there and possibly the rest of the region. The PMI survey, due at 0100 GMT (9 a.m. in Manila), is expected to show factory activity in China expanded at its slowest pace in eight months in May, according to a Reuters poll.

Analysts at ANZ expect the PMI report to influence base metals trading as well.

On Tuesday, US stocks inched lower, with the S&P 500 retreating slightly from a record, as weakness in the energy and financial sectors offset gains in technology shares.

In currency markets, the pound fell to $1.2791, near a one-month low of $1.2775 touched on Friday. The pound also slipped to 0.8738 pound per euro, near Friday's eight-week low of 0.8750.

New constituency-by-constituency modelling by YouGov showed the Conservative Party might lose 20 of the 330 seats it holds while the opposition Labour Party could gain nearly 30 seats, The Times said.

The dollar fell to two-week lows against the safe-haven yen as investors turned cautious amid political worries in Europe as well as weaker stock and commodity markets after a long US holiday weekend.

The dollar fell to near two-week low of 110.665 yen and last traded at 110.85 yen.

In commodities, oil prices remained soft, as concerns lingered about whether the extension of output cuts by OPEC and other producing countries will be enough to support prices.

US crude futures slipped about 0.1 percent to $49.61 a barrel. Global benchmark Brent was flat at $51.84 per barrel.

Gold edged lower to $1,262 an ounce.

source: news.abs-cbn.com

Global markets: Sterling on a high, shares sidelined as caution rules

SYDNEY - Sterling stole the show in Asia on Wednesday amid speculation Britain's surprise decision to call a snap election could ultimately deliver a more market-friendly outcome in its divorce from the European Union.

Safe-havens stayed in favor as gold and bonds climbed ahead of presidential elections in France and on escalating tensions between the United States and North Korea.

Equities were largely sidelined with MSCI's broadest index of Asia-Pacific shares outside Japan off 0.1 percent to the lowest since mid-March.

Japan's Nikkei eased 0.2 percent, in line with losses across the region.

Sterling surged to a more than six-month top against the dollar after British Prime Minister Theresa May called an early general election for June 8, seeking to strengthen her party's majority ahead of Brexit negotiations.

"We expect that the PM's gamble is likely to buy her more time as well as room for maneuver in the Brexit negotiations as she will depend less on fringe groups in her own party," said Citi's chief global political strategist, Tina Fordham.

"That may reduce the risk of a negotiation failure and thus 'chaotic Brexit', but also of the UK remaining in the Single Market in the long-term or even reversing the decision to leave the EU."

The pound was lording it at $1.2846 on Wednesday having shattered a months' old trading range with a jump of 2.2 percent overnight. It also cleared the 200-day moving average for the first time since June, putting the squeeze on a raft of speculative short positions.

Dollar selling spilled out broadly, sending the euro up to a three-week high at $1.0731. Against the yen, the dollar was stuck at 108.60 and near its lowest since November.

The dollar was also undermined by an eroding interest rate advantage as U.S. bond yields dived to five-month lows. Yields on 10-year Treasury paper sank to 2.17 percent , a world away from the 2.629 peak seen in March.

A run of disappointing US economic data and doubts the Trump administration will progress with tax cuts have quelled expectations of faster inflation and boosted fixed-income debt.

That, in turn, has taken the steam out of Wall Street. The Dow fell 0.55 percent on Tuesday, while the S&P 500 lost 0.29 percent and the Nasdaq 0.12 percent.

Goldman Sachs lost 4.7 percent in the largest daily drop since June after its earnings missed expectations as trading revenue dropped.

In commodity markets, the urge for safety helped lift gold to $1,287.70 an ounce and back toward Monday's peak of $1,295.42.

Oil prices slipped as US crude stockpiles fell by less than expected and a US government report said shale oil output in May was likely to post the biggest monthly increase in more than two years.

Brent crude was last down 7 cents at $54.82 a barrel, while U.S. crude fell 5 cents to $52.36.

source: news.abs-cbn.com

Global markets: Asia shares slip as US earnings disappoint, dollar gains

TOKYO - Asian shares flirted with three-week lows on Wednesday after a dour start to Wall Street's corporate earnings season knocked US stocks, while the dollar and Treasury yields rose on growing expectations of a US rate hike in December.

The British pound jumped back from lows in a volatile trading session though concerns about a "hard Brexit" are likely to keep the currency under pressure.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.4 percent while Japan's Nikkei futures slipped 0.7 percent.

On Wall Street, US S&P 500 Index fell 1.2 percent to near one-month low, and dipped below its 100-day moving average - seen as a major support - for the first time since June.

Shares of aluminum producer Alcoa tumbled 11.4 percent and diagnostics test maker Illumina plummeted 24.8 percent following their disappointing earnings, casting a pall over the market.

Market participants are also increasingly eyeing politics as the Nov. 8 U.S. elections draw near. The turmoil enveloping Republicans and the party's presidential candidate Donald Trump is prompting some speculation that a victory by Democrat Hillary Clinton could be accompanied by big gains for her party in Congress, investors said.

At the same time, investors are bracing for the US Federal Reserve to raise interest rates by the end of the year, most likely in December.

"The markets had relied on expectations of monetary stimulus for a long time but that is changing with bond yields rising around the world. You have rising interest rates and falling EPS. That's obviously bad for stocks," said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

The 10-year US Treasuries yield rose to 1.781 percent, its highest level since early June.

US interest rate futures are pricing in about 75 percent chance of a rate hike by December, little changed over the past couple of days.

The specter of rising US interest rates helped to lift the dollar's index against a basket of six major currencies to its highest level in seven months.

The index stood at 97.511, after having risen to as high as 97.758 on Tuesday, climbing above its July peak of 97.569.

The euro hit a two-month low of $1.1049 and last stood at $1.1061 while the offshore Chinese yuan traded at 6.7290 yuan to the dollar, near its lowest since January.

The yen was little changed at 103.42 to the dollar.

The British pound jumped 1.3 percent in thin early Asian trade to $1.2275, after having fallen nearly five percent in the previous four sessions.

Some market players suspected sterling benefited from a report by Bloomberg that British Prime Minister Theresa May has accepted that Parliament should be allowed to vote on her plan for taking Britain out of the European Union.

"The pound is being bought back after its big falls. But given that Brexit will remain a major theme for the markets, its likely to be capped," said Shinichiro Kadota, chief currency strategist at Barclays Securities Japan.

Oil prices retreated from one-year highs, after OPEC said it was trying to reach a global agreement to cap production for at least six months amid doubts about how much that would reduce a crude glut.

source: www.abs-cbnnews.com

Global markets: Mexican peso rises after Trump-Clinton debate, pound falls

LONDON - Sterling fell again on Monday, after largely recovering from Friday's "flash crash", while the Mexican peso and US stock futures rose as investors saw less chance of Republican nominee Donald Trump winning next month's presidential election.

The pound dropped half a percent against a dollar boosted by expectations the Federal Reserve will raise interest rates in December even after slightly weaker than expected jobs data on Friday.

The UK currency last stood at $1.2402, down 0.2 percent. Its trade-weighted index fell 0.7 percent to its lowest since early 2009.

"I guess that we have to prepare for further weakness," said Hans Redeker, head of G10 currency strategy at Morgan Stanley in London.

In early Asian trade on Friday, it fell 20 percent to a three-decade low of $1.1491 in minutes as a fall on investor concerns over Britain's impending exit from the European Union snowballed as automated computer trades were triggered.

Britain's FTSE 100 fell 0.1 percent but outperformed other major European stocks as the internationally-focused companies on the index gain on overseas revenues and competitiveness when the pound fall.

The more domestically-focused FTSE 250 index was down 0.2 percent and British 10-year government bond yields rose 1.3 basis points to 0.992 percent.

The pan-European STOXX 600 index fell 0.4 percent. One of the leading decliners was Deutsche Bank, down nearly 3 percent after Chief Executive John Cryan failed to secure a speedy deal with the US Department of Justice at the weekend over the misselling of mortgage-backed securities.

For Reuters' new Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

Another notable mover on currency markets was the Mexican peso, which at one point was up 2 percent at 18.91 to the dollar as Trump's chances of winning the White House seemed diminished after the second pre-election debate with Democratic Party candidate Hillary Clinton.

Trump has vowed to build a wall on the border with Mexico and renegotiate or scrap the North American Free Trade Agreement (NAFTA) if he is elected, making the peso somewhat of a barometer of his chances. The Mexican currency was last up 1.9 percent at 18.96 per dollar.

A CNN/ORC snap poll of debate watchers found that 57 percent thought Clinton won the encounter, versus 34 percent for Trump.

US stocks index futures were up about 0.2 percent, suggesting Wall Street will open higher. US stock markets are open on Monday, though the bond market is closed for the Columbus Day holiday.

Earlier, Asian shares eked out minor gains. MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.1 percent. Japanese markets were closed for a holiday.

Chinese shares racked up their biggest gains in two months as investors returned from a week-long holiday and caught up with gains on global markets.

YUAN

China's yuan, however, hit a six-year low against the dollar before recovering. The People's Bank of China set the weakest fix for currency since September 2010 and in the spot market fell as low as 6.7051, also its lowest since September 2010.

It last traded at 6.7025, down just 0.03 percent on the day.

Oil prices fell, with investors skeptical an agreement among members of the Organization of the Petroleum Exporting Countries (OPEC) to cut output would have a major impact.

Brent crude, the international benchmark, was down 18 cents at $51.73 a barrel.

"A meeting between OPEC and non-OPEC producers (namely Russia) will add to oil headlines this week. Don't expect a firm agreement from Russia, but headlines about cooperation are likely," Morgan Stanley said.

Gold last traded at $1,263 an ounce, up 0.6 percent, lifted by demand from returning Chinese investors.

source: www.abs-cbnnews.com

Global markets: Dollar firms, US stocks steady before jobs data

NEW YORK - The US dollar gained on Thursday against a basket of currencies, hitting its highest level in more than two months and pressuring gold prices, as strong labor market data gave support to a possible US interest rate hike later this year.

The benchmark S&P 500 stock index ended barely higher while Treasury yields rose to three-week highs as investors positioned ahead of the closely watched US employment report due out on Friday.

In an encouraging sign for the labor market, data on Thursday showed the number of Americans filing for unemployment benefits unexpectedly fell last week to near a 43-year low.

Oil prices continued to climb, with US crude breaking through $50, spurred by an informal meeting among the world's biggest producers on output cuts and plunging US crude inventories.

The dollar rose to its highest against the yen in a month, and pinned sterling firmly to a three-decade low on worries about Britain's exit from the European Union. Against a basket of currencies, the greenback gained 0.6 percent.

Strong US jobs numbers could cement expectations of a Federal Reserve rate increase later this year and ripple through markets. Economists polled by Reuters forecast non-farm payrolls to increase by 175,000.

Traders were betting on a 64-percent chance the Fed will hike rates in December, up slightly from a day earlier, according to the CME FedWatch website.

"If you look at the economic data for the past month, pretty much across the board it's better and in some cases materially better than expectations," said Walter Todd, chief investment officer at Greenwood Capital Associates in Greenwood, South Carolina. "All of that would seem to push the Fed to move."

In the US equity market, the Dow Jones industrial average fell 12.53 points, or 0.07 percent, to 18,268.5, the S&P 500 gained 1.04 points, or 0.05 percent, to 2,160.77 and the Nasdaq Composite dropped 9.17 points, or 0.17 percent, to 5,306.85.

Gains in Apple, bolstered by optimism about the iPhone, countered a drag from Wal-Mart Stores, which tempered its profit expectations.

The pan-European STOXX index fell 0.4 percent. Shares of British budget airline easyJet tumbled after a weak profit report.

MSCI's gauge of stocks across the globe dipped 0.12 percent.

Europe's benchmark German bond yield edged briefly back above zero, reversing earlier falls, as a selloff in the British government bond market spilled over into the euro area.

Britain's 10-year gilt yield jumped nearly 10 basis points to a three-week high.

Benchmark 10-year US notes were last down 7/32 in price to yield 1.74 percent, up from nearly 1.72 percent late on Wednesday.

Oil rallied to fresh four-month highs.

Brent crude futures settled up 1.3 percent at $52.51 a barrel. US crude settled up 1.2 percent at $50.44 a barrel, eclipsing $50 for the first time since June.

"The fact that you've got crude look like it's willing to hold around that $50 level I think is a positive for the (stock) market," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "That's maybe another confirmation giving a positive tone to future economic activity."

Spot gold dropped 1.1 percent and touched a four-month low, falling for an eighth straight session.

source: www.abs-cbnnews.com