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Germany Consumer Climate Falls in October

By Xinyang September 28, 2016
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News Event

From Trading Economics: The GfK Consumer Climate for Germany is set to come in at 10 in October 2016, compared to 10.2 in September. The figure was below market consensus as economic and income expectations fell, as well as propensity to buy. "The current decline is indicative of how consumer sentiment is not completely immune to the prevailing rise of uncertainty, which also seems to be affecting consumers. This uncertainty is first and foremost being fueled by the greater perceived terror threat in Germany as well as by the decision made by the British public to vote to leave the European Union. The consequences of this for the European and, above all, German economy are still completely unclear," GfK said in its statement. Consumer Confidence in Germany averaged 5.58 from 2001 until 2016, reaching an all time high of 16.80 in March of 2001 and a record low of -3.50 in March of 2003. Consumer Confidence in Germany is reported by the GfK Group.

Market Snap

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Market Opening Wrap

In Asian Equity Markets stocks were mostly lower on Wednesday, with European banking sector concerns and lower crude oil prices dulling investors' appetite for riskier assets. MSCI's broadest index of Asia-Pacific stocks outside Japan was down 0.1 percent, erasing earlier modest gains. South Korea's Kospi fell 0.4 percent and Shanghai lost 0.2 percent. Australian stocks were flat. Japan's Nikkei underperformed and was last down 1.5 percent. Japanese stocks were dogged by threats of a robust yen, which hurts exporters' earnings. The broader Topix fell 1.6 percent to 1,327.89 and the JPX-Nikkei Index 400 fell 1.7 percent to 11,884.30.

In Currency Markets the dollar rose versus the yen on Wednesday, while the euro nursed its losses after retreating on concerns over the health of the European financial system. The dollar  rose 0.2 percent to 100.69 yen, regaining some footing after setting a one-month low of 100.085 yen on Tuesday. The euro held steady at $1.1209, languishing below this week's high of $1.1280 set on Monday. The euro had retreated on Tuesday as share prices in Deutsche Bank fell to a record low. The Australian dollar traded at $0.7670, up 0.04 percent.  Against a basket of six major currencies, the dollar edged up 0.1 percent to 95.551. Data released on Tuesday showed that U.S. consumer confidence improved, while a service sector survey also came in better than expected.

In Commodities Markets oil prices rose in mixed trading on Wednesday, after sharp losses in the previous session, as industry data showed a surprise draw in U.S. crude stocks, although worries over a lack of agreement among producers to curb output kept a lid on gains. Brent crude rose 24 cents to $46.21 a barrel after settling down 2.9 percent. U.S. West Texas Intermediate crude was up 11 cents at $44.79 a barrel after climbing as high as $45.09 in earlier trading. Spot gold fell 0.2 percent to $1,324.71 an ounce. Among other precious metals, spot silver was down for the fourth straight session having fell 0.6 percent at $19.03 an ounce. Platinum was up 0.2 percent at $1,024.40 and palladium gained 0.4 percent to $700.60 per ounce.

In US Equity Markets consumer and technology stocks, including Amazon, led gains on Wall Street on Tuesday, while a perceived win by Democrat Hillary Clinton in Monday's first presidential debate gave broader support to equities. The Dow Jones industrial average rose 0.74 percent to end at 18,228.3 points and the S&P 500 gained 0.64 percent to 2,159.93. The Nasdaq Composite added 0.92 percent to 5,305.71. The S&P 500 technology sector rallied 1.15 percent, powered by a 1.85 percent gain in Microsoft and a 1.08 percent rise in Facebook. Amazon.com jumped 2.12 percent and the consumer discretionary index gained 0.99 percent after a report showed that the consumer confidence index for September rose to its highest level in nine years.

In Bond Markets U.S. long-dated Treasury debt yields fell to three-week lows on Tuesday on concerns about ongoing problems at Deutsche Bank, Germany's largest lender, which could again delay the next interest rate hike by the Federal Reserve. In late trading, U.S. 10-year Treasury notes were up 8/32 in price, yielding 1.559 percent, down from 1.589 percent late Monday. U.S. 30-year bonds rose more than a point in price, yielding 2.276 percent, down from Monday's 2.327 percent. On the front-end, U.S. two-year notes were flat for a yield of 0.750 percent, down from 0.759 percent late on Monday.

Source: Institute of Trading and Portfolio Management

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By Xinyang September 28, 2016

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