In European Equity Markets stocks steadied on Tuesday, as gains in the auto sector on news that PSA Group is in talks to buy General Motors’ European auto operations and stronger banking stocks offset weaker consumer and pharma stocks. The pan-European STOXX 600 index ended flat at 370.2 points, staying near 13-month highs hit in the previous session. Shares in PSA Group rose 4.3 percent to an 18-month high after the French car maker said it was in talks to buy GM’s European brands Opel and Vauxhall in a move that could shake up the global auto industry. Fiat Chrysler rose 4.1 percent and Faurecia rose 0.7 percent. The auto sector index rose 1.1 percent, making it the biggest sectoral gainer in Europe.
In Currency Markets the dollar rose to a three-week peak against a basket of major currencies on Tuesday as investors raised their outlook on a faster pace of U.S. rate increases following comments from Federal Reserve Chair Janet Yellen. The greenback hit a two-week peak of 114.47 yen, erasing an earlier decline against the Japanese currency. It was last up 0.6 percent at 114.42 yen. The euro fell 0.3 percent against the greenback at $1.0567 amid political risk and disappointing regional economic data. Sterling touched lows of $1.2445 and was last at $1.2455, off 0.57 percent for the day. The dollar index reached a three-week high at 101.38, reversing from a earlier fall to 100.90. It was last at 0.35 percent at 101.32.
In Commodities Markets oil pared gains on Tuesday as concerns about rising supply from U.S. shale output overshadowed an OPEC-led effort to cut global output, which has supported oil prices in a higher range. Brent crude was 61 cents higher at $56.20 a barrel, after earlier rising to $56.46 a barrel. U.S. light crude was up 45 cents at $53.38. The OPEC and other exporters including Russia have agreed to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017 in a bid to rein in a global fuel supply overhang. Spot gold fell 0.2 percent to $1,222.60 an ounce, while U.S. gold futures lost 0.2 percent to $1,223.80. Spot silver fell 0.1 percent to $17.77.
In US Equity Markets stocks edged lower on Tuesday after Fed Chair Janet Yellen said the central bank will likely need to raise interest rates at an upcoming meeting, but expressed uncertainty over economic policy under the Trump administration. The Dow Jones Industrial Average was down 0.04 percent, at 20,402.99, the S&P 500 was down 0.17 percent, at 2,324.29 and the Nasdaq Composite was down 0.16 percent, at 5,754.63. Nine of the 11 major S&P sectors were lower, led by the high dividend-yielding utilities and real estate sectors, both of which were down more than 1 percent. General Motors rose 3.9 percent after Peugeot-owner PSA Group said it is in talks to buy GM’s European Opel business.
In Bond Markets U.S. Treasury yields jumped on Tuesday after Federal Reserve Chair Janet Yellen said it would be unwise to wait too long to raise interest rates, striking a more hawkish tone than investors expected. Benchmark 10-year notes fell 15/32 in price to yield 2.49 percent, the highest since Feb. 3, up from 2.44 percent before the testimony. German 10-year yields initially fell slightly on Tuesday, but were some 4 basis points higher at a one-week high of 0.38 percent as markets prepared to close.