February 26th, 2019

In European Equity Markets the pan-European Stoxx 600 ended the session 0.5 percent higher, with most sectors in positive territory, after spending much of the day in the red. In Europe, retail was the best performer, up 2 percent. Reports revealed that British high street chain Marks & Spencer was in talks with Ocado to create a full online food delivery service. Shares of Marks & Spencer were up 3.2 percent during afternoon trade, while Ocado shares gained almost 12 percent and soared towards the top of the index.

In Currency Markets sterling jumped to a five-month high against the dollar on Tuesday as investors ramped up bets that a no-deal Brexit could be avoided after Prime Minister Theresa May offered MPs the chance to vote on delaying the process. The pound was up 1.4 percent at $1.3284, extending earlier gains shortly after a British lawmaker said his plan to give parliament control of the Brexit process would likely not be voted upon on Wednesday because of May’s proposals. Sterling also strengthened further against the euro to a new 21-month high, up 1.2 percent on the day.

In Commodities Markets oil edged up to $65 a barrel on Tuesday as OPEC was expected to stick to its production cuts despite pressure from U.S. President Donald Trump, although the prospect of higher Libyan output capped gains. Brent crude, the global benchmark, rose 25 cents to $65.01, after losing 3.5 percent on Monday. U.S. West Texas Intermediate crude eased 19 cents to $55.29. Prices fell on Monday, when many traders were out of the office attending IP Week, an industry event in London, after Trump called on OPEC to ease its efforts to boost the oil market.

In US Equity Markets the S&P 500 index and the Nasdaq cut all losses on Tuesday to eke out slight gains, after a report from the Conference Board showed a higher-than-expected rise in the consumer confidence index in February. Shares of Home Depot fell 2.5 percent after the home improvement retailer posted weaker-than-expected fourth-quarter results. Caterpillar stock fell nearly 3 percent after UBS double downgraded the shares to sell from buy on Tuesday, citing slowing global construction demand.

In Bond Markets France’s 10-year government bond yield fell to its lowest since November 2016 on Tuesday as the effect of the “yellow vest” protests faded. Other high-grade euro zone bond yields were a tad higher by late trade, following strong U.S. consumer confidence data. But Southern European bond yields fell sharply on storming demand for Spain’s 15-year syndicated bond deal. France’s 10-year bond yield fell 2 basis points to 0.505 percent, the lowest in 27 months. Italian bond yields were down as much as 8 bps , while Greek bond yields also fell sharply.