Dollar, Europe stocks firm as Jackson Hole arrives

Sydney - Concerns about the Trump administration’s ability to enact its fiscal agenda were put on the back-burner in European trading, as focus turned instead to the start of the central bankers’ meeting in Jackson Hole. The dollar strengthened while stocks in Europe advanced.

As the euro and most G-10 peers edged lower against the greenback, the Stoxx Europe 600 Index climbed after a mixed session for Asian equities. Investors appear to be largely marking time as they wait to see whether the gathering of policy makers in Wyoming will offer any hints on the process of unwinding stimulus.

Oil fell after jumping a day earlier, but held above $48 a barrel as US crude stockpiles extended declines during a period of seasonally strong demand.

Expectations for meaningful comments from the key speakers at Jackson Hole - Federal Reserve Chair Yellen and European Central Bank President Mario Draghi - seem fairly low, but amid lackluster August trading the event is significant enough to capture the focus of most investors.

If nothing else, it’s a welcome distraction from US politics. All major US equity benchmarks fell on Wednesday after President Donald Trump’s threat to shut down the government.

Among other key events looming this week:

• Hong Kong’s trade balance is due on Thursday.

• The latest figures on combined sales of previously-owned US homes are also on Thursday.

• Yellen is scheduled to speak about financial stability at 10:00 New York time on Friday at the Kansas City Fed’s symposium.

• Draghi is set to give a speech at 3pm.

Here are the main moves in markets:

Asia

• Japan’s Topix index fell 0.5%.

• South Korea’s Kospi index increased 0.4% and Australia’s S&P/ASX 200 Index added 0.1%.

• Hong Kong’s Hang Seng Index rose 0.5% as the market reopened after being shut on Wednesday.

• The MSCI Asia Pacific Index edged lower, erasing a gain of as much as 0.3%.

• The Japanese yen fell 0.2% to ¥109.30/$.

Stocks

• The Stoxx Europe 600 Index gained 0.2% as of 09:40.

• The UK’s FTSE 100 Index rose 0.3% to the highest in more than a week.

• Germany’s DAX Index increased 0.1%.

• Futures on the S&P 500 Index climbed less than 0.05%.

Currencies

• The Bloomberg Dollar Spot Index gained 0.2%.

• The euro dipped 0.1% to $1.1794.

• The British pound decreased less than 0.05% to $1.2797, the weakest in almost two months on a closing basis.

Bonds

• The yield on 10-year Treasuries gained one basis point to 2.18%.

• Germany’s 10-year yield fell less than one basis point to 0.38% on its sixth consecutive decline.

• Britain’s 10-year yield increased less than one basis point to 1.062%.

Commodities

• West Texas Intermediate crude decreased 0.3% to $48.30 a barrel.

• Gold fell 0.3% to $1 286.85 an ounce.

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter: Fin24’s top stories