In European Equity Markets banking stocks drove bourses higher on Thursday after the U.S. Federal Reserve signaled a likely December rate hike and announced it would begin trimming its balance sheet in October. The pan-European STOXX 600 ended up 0.3 percent while euro zone stocks and blue-chips rose 0.4 percent as the U.S. central bank’s optimism on the economy stoked renewed enthusiasm for financials and cyclical sectors in Europe. Banks jumped 1.4 percent to a one-month high on the prospect of the European Central Bank following the United States in bringing ultra-loose monetary policy to an end. Commerzbank rose 3.5 percent on reports of merger approaches.

In Currency Markets the dollar weakened against a basket of currencies on Thursday, retreating from a more than two-week peak as bets stoked by the Federal Reserve signalling it may raise interest rates in December abated. The greenback firmed against the yen, hitting a two-month peak at 112.71 yen in overseas trading. It was last up 0.06 percent at 112.28 yen.  Norway’s crown rose against the dollar and euro after the country’s central bank kept its policy rate unchanged but said a rate increase is likely earlier than previously expected. The crown was up 0.3 percent at 9.316 per euro and 0.6 percent firmer against the dollar at 7.8167 crowns. The euro was up 0.24 percent at $1.1922.

In Commodities Markets  oil prices were largely steady on Thursday as traders waited to see whether oil-producing countries set to meet in Vienna would extend production limits that have helped reduce the global crude glut. Global benchmark Brent crude lost 5 cents a barrel to $56.24 a barrel. U.S. crude was down 0.28 percent, at $50.55 a barrel.  Spot gold was down 0.7 percent at $1,291.95 an ounce, having earlier touched its lowest since late August at $1,287.61. Silver was down 1.1 percent at $16.94 an ounce. Platinum was 0.5 percent lower at $936.10 an ounce, after touching a near eight-week low of $925 earlier in the day, while palladium was up 0.5 pct to $914.60 an ounce.

In US Equity Markets  stocks fell from their all-time highs on Thursday, weighed down by Apple and the hawkish stance of the Federal Reserve, which hinted at raising interest rates for a third time this year despite low inflation. The Dow Jones Industrial Average was down 0.04 percent, at 22,403.55, the S&P was down 0.18 percent, at 2,503.67. The Nasdaq Composite was down 0.53 percent, at 6,421.74. Nvidia pared losses to trade down 3.1 percent after GlobalFoundries, which fabricates chips for Advanced Micro Devices, said Tesla had not committed to working with the company to develop its own artificial intelligence chip for self-driving cars. Shares of Apple fell 1.7 percent and was on track to post its biggest two-day decline since June.

In Bond Markets the U.S. Treasury yield curve flattened to two-and-a-half month lows on Thursday as investors adjusted for the likelihood of December interest rate increase, a day after the Federal Reserve struck a more hawkish than expected tone at its September meeting. Benchmark 10-year notes were last up 5/32 in price to yield 2.26 percent, up from 2.24 percent before Wednesday’s Fed statement. The yield on Germany’s 10-year government was 4 basis points higher in early trade at 0.48 percent, its highest since early August.

European Equity Upgrades/Downgrades

• ASHTEAD (AHT LN) RESUMED WITH A BUY RATING AT DEUTSCHE BANK
• GERRESHEIMER (GXI GY) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT MAINFIRST
• AURUBIS (NDA GY) DOWNGRADED TO UNDERPERFORM FROM NEUTRAL AT EXANE
• DEUTSCHE BANK (DBK GY) UPGRADED TO HOLD FROM REDUCE AT HSBC
• ESSILOR (EI FP) INITIATED WITH UNDERPERFORM AT RBC
• ELIS (ELIS FP) UPGRADED TO OUTPERFORM FROM NEUTRAL AT CREDIT SUISSE
• LUXOTTICA GROUP (LUX IM) CUT TO UNDERPERFORM FROM SECTOR PERFORM AT RBC
• CARLSBERG (CARLB DC) DOWNGRADED TO NEUTRAL FROM OUTPERFORM AT EXANE
• ERICSSON (ERICBS SS) DOWNGRADED TO SELL FROM HOLD AT CARNEGIE
• MUNICH RE (MUV2 GY) UPGRADED TO BUY AT CITI