Germany Manufacturing PMI Increases in September

News Event

From Trading Economics: The Flash Germany Manufacturing PMI rose to 54.3 in September 2016 compared to 53.6 in August and above market consensus of 53.1. It was the highest figure since June this year, as new export orders expanded at fastest pace since the beginning of 2014 and business outstanding increased solidly during the month. Also, employment continued to increase. Meanwhile, German manufacturers remained cautious about their stock policies in September, with finished goods inventories falling at the fastest pace since 2010 and pre-production stock declining further.

Market Wrap

In European Equity Markets stocks ended weaker on Friday, pulling back from two-week highs in the previous session after the Federal Reserve signalled an increasingly cautious approach to future rate hikes, with banks leading sectoral fallers. The pan-European STOXX 600 index ended 0.7 percent lower. The STOXX Europe 600 Banks index fell 1.5 percent, the top sector faller. Banco Santander, Bankia, Intesa Sanpaolo and Deutsche Bank fell 2 to 3 percent. On the positive side, Aryzta rose nearly 10 percent after the Swiss bakery company said that Gary McGann will join its board as the chairman. Lundbeck fell more than 15 percent after the Danish drug maker's highly anticipated idalopirdine Alzheimer's drug failed in a late-stage study.

In Currency Markets the dollar index edged higher on Friday, reversing earlier selling, after Boston Federal Reserve President Eric Rosengren said he believed U.S. short-term interest rates should be raised now and warned a decline in the jobless rate below sustainable levels could derail economic recovery. The dollar gained 0.31 percent to 101.05 yen, off Thursday's one-month low of 100.06. The euro held steady at $1.1210, while sterling tumbled 0.96 percent to $1.3009, the lowest since August 16. The Australian and New Zealand dollars were weaker, with Aussie down 0.30 percent at $0.7620 and with Kiwi losing 1.09 percent to $0.7233. The dollar index was last up 0.1 percent at 95.531.

In Commodities Markets  oil prices fell about 3 percent on Friday, paring weekly gains, on a report that Saudi Arabia did not expect an agreement at talks next week among major crude exporters aimed at freezing production.  Brent crude oil was down 2.8 percent, at $46.32 a barrel. For the week, it was up 1.6 percent. U.S. West Texas Intermediate crude was down 2.9 percent, at $44.92. On the week, WTI showed a gain of less than 5 percent. Spot gold was up 0.2 percent at $1,338.36 an ounce and silver was 0.2 percent lower at $19.78. alladium was up 0.5 percent at $696.50, after rising 1.5 percent on Thursday. Platinum was 0.1 percent higher at $1,052.60 an ounce.

In US Equity Markets  stock indexes opened lower on Friday but were poised to end the week higher after a three-day rally spurred by optimism that the Federal Reserve will hold off from raising interest rates in the near term. The S&P 500 was down 0.2 percent, at 2,172.77 and the Nasdaq Composite was down 0.21 percent, at 5,328.40.  Facebook was down 1.5 percent at $128.11 after the WSJ reported the social media giant overestimated viewing time for video ads by 60-80 percent for two years. Twitter rose 15.7 percent to $21.55 after CNBC reported the microblogger is moving closer to a sale and that suitors include Alphabet's Google and Salesforce.com. Salesforce was down 3.5 percent and Alphabet was down 0.2 percent.

In Bond Markets U.S. Treasury yields were little changed on Friday with benchmark yields hovering near two-week lows as traders moved to the sidelines following a bond market rally tied to bets the Federal Reserve would raise interest rates gradually. The 5-to-30-year part of the U.S. yield curve was last at 118 basis points, 1 basis point wider than late Thursday. U.S. benchmark 10-year Treasury notes were up 1/32 in price for a yield of 1.627 percent, down 0.5 basis point from Thursday.

Source: Institute of Trading and Portfolio Management