Closing Feb27

In European Equity Markets the pan-European Stoxx 600 closed down 0.38 percent with all but three sectors in negative territory. Air France-KLM fell 10 percent Wednesday following news that the Dutch government is seeking a higher stake of the company.There are fears that as a result the company's decision-making process will be slower. Furthermore, the British bank Metro fell to the bottom of the index, down by more than 26 percent. This was after revealing plans for a £350 million ($463 million) shareholder cash call.

In Currency Markets sterling rallied to its highest levels in seven months on Wednesday as investors ramped up bets that a no-deal Brexit was less likely and that Britain’s departure from the European Union would be delayed. Against the dollar, the pound rallied 0.6 percent to its highest since July 2018 at $1.3335. For the month, it is the best performing currency against the dollar among major currencies, clocking a gain of 1.6 percent so far. It also rallied by a similar magnitude against the euro to 85.40 pence.

In Commodities Markets oil rallied for a second day on Wednesday, buoyed by an unexpected decline in U.S. crude inventories and after Saudi Arabia appeared undaunted by pressure from U.S. President Donald Trump on OPEC to prevent steeper price rises. Brent crude futures rose 71 cents to $65.92 a barrel, while U.S. futures rose $1.13 to $56.63 a barrel. Helping the prices was a surprise decline in U.S. crude inventories, which fell by 4.2 million barrels in the latest week, according to the API. This compared with forecasts in a Reuters survey for a rise of 2.8 million barrels

In US Equity Markets stocks added to losses on Wednesday after U.S. Trade Representative Robert Lighthizer said U.S. issues with China are “too serious” to be resolved by promises of more purchases of U.S. goods by Beijing. The S&P 500 was down 0.49 percent, at 2,780.23 and the Nasdaq Composite fell 0.68 percent, at 7,498.09. Healthcare and internet companies move lower. Weight Watchers fell 35 percent after issuing a surprisingly weak forecast, and drug maker Mylan declined 13.5 percent after also giving a weak outlook.

In Bond Markets Italian government bond yields rose sharply on Wednesday, pushed higher by disappointing economic data, a debt auction and criticism from the European Commission over the state of Italy’s economy. After an initial dip in early trade, Italian government bond yields rose up to 12 basis points across the curve, with analysts citing renewed concerns about the country’s economy. Italy’s 10-year government bond yields were last up eight basis points to 2.79 percent, having pulled back from 3-1/2 week lows hit on Wednesday.