In European Equity Markets the pan-European Stoxx 600 traded down by nearly 0.6% by the close of trade, as investors digested different developments on the trade front. Furthermore, the U.S. trade representative also said Monday that it could put duties of up to 100% on certain French products. This is on the back of France’s decision to apply a tax on digital companies. The U.S. trade office concluded that the French levy is harmful to U.S. tech companies. French luxury stocks were down on the news. Kering, Hermes and LVMH fell more between 1.5%and 2.5%.


In Currency Markets the pound climbed to its highest levels in six weeks on Tuesday against the backdrop of broad-based dollar weakness and after a new poll showed the ruling Conservative Party widening its lead before next week’s election. Prime Minister Boris Johnson’s Conservatives led the main opposition Labour party by 12 points, a survey by Kantar showed on Tuesday, before a parliamentary election on Dec. 12. Against the dollar, the pound rose as much as 0.5% to $1.3010, its highest level in six weeks and within a whisker of reaching its highest since May. Sterling meanwhile gained 0.4% versus the euro to 85.13 pence.


In Commodities Markets oil steadied on Tuesday, as expectations of output cuts from OPEC and allied producers brought prices back up after they slid briefly following comments from U.S. President Donald Trump that a trade deal with China may be delayed. Brent crude futures rose 5 cents to $60.97 a barrel. U.S. West Texas Intermediate (WTI) crude futures rose 9 cents to $56.05 a barrel. Trump said a U.S.-China trade agreement might have to wait until after next November’s presidential election, denting hopes of a quick resolution to a dispute that has weighed on the world economy.


In US Equity Markets stocks extended declines on Tuesday as U.S. Commerce Secretary Wilbur Ross said on CNBC that U.S. tariffs on Chinese imports due Dec. 15 would be imposed unless there was substantive progress in trade talks. The S&P 500 was down 1.08%, at 3,080.31. The Nasdaq Composite fell 1.10%, at 8,473.85. Nine of the 11 major S&P 500 sectors were trading lower, with tech heavyweights Apple Inc, Microsoft Corp and Inc weighing the most. AK Steel Holding Corp rose 4% after miner Cleveland Cliffs Inc agreed to buy the steel maker for about $1.1 billion in an all-stock deal. Shares of Cleveland-Cliffs fell 13.4%.


In Bond Markets European bond yields turned lower on Tuesday, reversing all the previous day’s gains, after U.S. President Donald Trump said he had no deadline for reaching a trade agreement with China, adding it could come after the 2020 U.S. election. Irish 10-year government bond yields fell negative for the first time since Oct. 31 and U.S. 10-year Treasury yields declined to 1.7%, their lowest since Nov. 1. Yields on benchmark 10-year German government debt slipped 7 bps to -0.347% after rising to -0.26% in early European trading, its highest in three weeks. U.S. 10-year yields fell13 bps to 1.7054%.

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