Energy Shares Rise as Crude Gains

12/12/17 04:12 AM EST
By David Hodari and Gregor Stuart Hunter 
   -- Brent crude hits 2 1/2 -year high 
 
   -- Europe tech sector bucks Asian negativity 
 
   -- Investors await Draghi speech 

European stocks edged down Tuesday, despite buoyancy among the technology and oil-and-gas sectors.

The Stoxx Europe 600 fell 0.1% in morning trading, while the euro rose 0.2% to $1.1787. A stronger euro tends to weaken shares of European multinationals which translate earnings from abroad.

The European tech sector received a boost, with Atos shares up 5.6% on its bid for Dutch software firm Gemalto, which itself rose 32.4%. The Stoxx Europe 600 technology sector rose 0.7%.

The Stoxx Europe 600's oil-and-gas sector also gained, rising 0.6%, with Statoil up 2.1% and Tullow Oil up 1.1%.

Rising oil prices helped Australia's commodities-heavy S&P/ASX 200 index buck the negativity of the broader Asian region and finish 0.2% higher.

Asian stocks mostly pulled back, with regional tech shares reversing gains made Monday.

Hong Kong's Hang Seng Index fell 0.6%, led by a 2.9% drop in heavyweight Tencent Holdings. Tencent's fall came after it disclosed that one of its units is in talks to acquire a minority stake in supermarket operator Yonghui.

Camera-maker Sunny Optical, a Hang Seng newcomer, slid another 7.5% after it said that Chinese mobile-phone shipments in November fell 21% from a year earlier.

Taiwan's tech-heavy Taiex fell 0.3% and Korea's Kospi slipped 0.4%, despite a 0.6% gain for index heavyweight Samsung Electronics.

That tech weakness, and a 0.1% rebound for the yen versus the dollar to Yen113.4860, helped push the Nikkei down 0.3% in late trading.

Regional selling also stung Chinese stocks, with the Shanghai Composite down 1.3% and the Shenzhen Composite down 1%.

That Chinese equity weakness came despite credit data released late Monday revealed resilient bank lending in November, with some money leaving the shadow-banking sector.

Investors were awaiting cues from global central banks. The Federal Open Market Committee's two-day meeting was set to begin Tuesday, with its interest rate decision due Wednesday. Data from CME Group revealed that investors were betting on a 100% probability that the Fed will announce a rate increase.

U.S. 10-year Treasury yields ticked down to 2.382% from 2.387% late Monday.

The European, British, Swiss and Norwegian central banks were also scheduled to meet this week, with European Central Bank President Mario Draghi due to give a speech Tuesday.

"The main focus from Draghi is that we'll get new economic forecasts and we'll get 2020 [forecasts] for the first time... he may also give more detail on how [the ECB] plans to scale back purchases to EUR30 billion from EUR60 billion. Will they halve all purchases or take a more nuanced approach?" said James Knightley, chief international economist at ING.

Bitcoin prices slipped after Securities and Exchange Commission Chairman Jay Clayton warned about the risks to retail investors in the red-hot cryptocurrency. Coindesk's Bitcoin USD Price Index was recently up 0.6% at around $16,979.60 after nearing $17,400 in late New York trading.

Write to David Hodari at David.Hodari@dowjones.com and Gregor Stuart Hunter at gregor.hunter@wsj.com

 

(END) Dow Jones Newswires

December 12, 2017 04:12 ET (09:12 GMT)

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