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Markets Update pm

European shares slump to one-month low after oil price slips

* FTSEurofirst 300 index falls over 2 percent

* Energy shares track weaker crude oil prices

* Osram falls after Apple drops from supplier list

April 1 European equities tumbled to a one-month low on the first trading day of the quarter on Friday, with energy stocks hit by weaker oil prices while Osram retreated after it was dropped from Apple‘s top supplier list.

The pan-European FTSEurofirst 300 index fell 2.5 percent to its lowest level in a month, extending the previous session’s loss of 1 percent. The benchmark index fell 7.7 percent in the first quarter.

European stock markets stayed in negative territory after the U.S. jobs data was published.

Some traders pointed to the fact that the U.S. unemployment rate rose to 5.0 percent from an eight-year low of 4.9 percent as making it more likely that the U.S. may refrain from further interest rate rises in the near future.

This pushed down the U.S dollar on currency markets, but moved the euro up against the dollar – impacting European stocks since European exporters often benefit from a weak euro to make their goods more affordable for overseas buyers.

“More dollar weakness seems likely for now, which could have a negative effect on European stocks,” said Darren Sinden at Admiral Markets.

Energy stocks dropped 3.8 percent as a decline in crude oil prices pushed down the shares of BP and Total .

Bloomberg:”Europe’s equity benchmark was set to erase all of its gains for March in a single day“, while crude oil plunged after Saudi Arabia’s deputy crown prince said the kingdom will only freeze its oil output if Iran and other major producers do so. Copper rose after a gauge of Chinese manufacturing unexpectedly expanded, while shares in Shanghai were little changed.

In Asia, for Japan, the post “Shanghai Summit” world is turning ugly, fast, because as a result of the sliding dollar, a key demand of China which has been delighted by the recent dovish words and actions of Janet Yellen, both Japan’s and Europe’s stock markets have been sacrificed at the whims of their suddenly soaring currencies. Which is why when Japanese stocks tumbled the most in 7 weeks, sinking 3.5%, to a one month low of 16,164 (after the Yen continued strengthening and the Tankan confidence index plunged to a 3 year low) it was anything but an April fool’s joke to both local traders.

Data:

  • S&P 500 futures down 0.4% to 2044
  • Stoxx 600 down 1.6% to 334
  • FTSE 100 down 0.9% to 6119
  • DAX down 1.3% to 9839
  • German 10Yr yield up less than 1bp to 0.16%
  • Italian 10Yr yield up less than 1bp to 1.23%
  • Spanish 10Yr yield up 1bp to 1.45%
  • S&P GSCI Index down less than 0.1% to 323.3
  • MSCI Asia Pacific down 2.3% to 126
  • Nikkei 225 down 3.5% to 16164
  • Hang Seng down 1.3% to 20499
  • Shanghai Composite up 0.2% to 3010
  • S&P/ASX 200 down 1.6% to 4999
  • 10-yr yield up 3bps to 1.8%
  • Dollar Index up 0.02% to 94.6
  • WTI Crude futures down 2.3% to $37.60
  • Brent Futures down 0.1% to $40.28
  • Gold spot up less than 0.1% to $1,233
  • Silver spot down 0.2% to $15.40

Top Global News

  • Asian markets fall. Japan’s stocks sink most in 7 weeks; Tankan index of confidence among manufacturers at 3-year low
  • China’s official manufacturing purchasing managers index rose unexpectedly in March; highest level since Nov. 2014
  • Oil trades lower after Saudis announce they will freeze production only if Iran joins
  • Musk Unveils Tesla’s $35,000 Model 3 in Push for Mass Market: Battery-powered Model 3 will be rated about 215 miles range. Tesla collects more than 115,000 orders within 24 hours
  • Einhorn’s Greenlight Fund Flat in March, Halting ’16 Rebound: Firm is seeking to bounce back from 2015 loss of more than 20%. Average hedge fund is down this year amid stock-market swings
  • Anbang Abruptly Pulls Starwood Offer, Clearing Marriott Path: Group cites ‘various market considerations’ for withdrawal. Shareholder vote on Marriott takeover set for April 8
  • Yahoo Losing Another Senior Manager Amid Turnaround Effort: Sandy Gould departing after joining Web portal three years ago. Exit follows resignations of several other executives in 2015
  • JPMorgan, Wells Fargo Asked by U.S. to Save Records Tied to 1MDB: Requests add to ranks of banks cooperating in global probes. Banks, which include Deutsche Bank, aren’t seen as targets
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