In European Equity Markets the pan-European Stoxx 600 closed 0.2 percent lower with the various sectors taking different directions. Autos and Basic Resources were the worst-performing sectors, on the back of ongoing trade concerns. Travel and Leisure stocks fell almost 1 percent on the back of a profit warning by Thomas Cook. The airline suspended dividend payouts and issues its second profit warning in two months. Shares were close to a six-year low. European banks were also below the flat-line, after various rating downgrades by Morgan Stanley.

 

In Currency Markets the U.S. dollar gained on Tuesday after Federal Reserve Vice Chair Richard Clarida backed further interest rate hikes but noted the importance of monitoring economic data as the U.S. central bank approached a neutral stance. Sterling fell against the dollar and the euro on Tuesday as doubts grew about whether British Prime Minister Theresa May can get a Brexit agreement through a divided parliament. Against the dollar, the British currency fell more than half a percent to $1.2730, its lowest level in nearly two weeks.

 

In Commodities Markets oil prices steadied on Tuesday, depressed by record Saudi production but supported by expectations that oil exporters would agree to cut output at an OPEC meeting next week. Brent crude oil was up 10 cents a barrel at $60.58, not far above a 13-month low of $58.41 reached on Friday. U.S. light crude was up 10 cents at $51.73. Oil prices are down by almost a third since early October, weighed down by an emerging supply overhang and widespread financial market weakness.

 

In US Equity Markets stocks declined on Tuesday after President Donald Trump’s threat to move ahead with additional tariffs on Chinese goods dampened hopes of resolving the trade spat at the upcoming G20 Summit. Apple Inc fell 1.6 percent and led the declines in the technology sector after Trump said tariffs could also be placed on laptops and iPhones imported from China. The S&P 500 was down 0.46 percent, at 2,661.08 and the Nasdaq Composite fell 0.71 percent, at 7,031.86. United Technologies Corp fell nearly 6 percent, the most on the benchmark S&P 500 index.

 

In Bond Markets Treasury yields fell almost a basis point on Tuesday morning as investors bought the longer end of the curve on resurgent worries about U.S.-China trade tensions after President Donald Trump said he expected to increase tariffs on Chinese goods. The benchmark 10-year government yield was down a basis point from Monday’s close, last at 3.06 percent. The two-year note yield was down 0.3 basis point to 2.83 percent. The 30-year yield was down 0.7 basis point to 3.31 percent.

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