Finance

European shares in the red as investors show interest in bonds, oil

European shares in the red as investors show interest in bonds, oil

Market participants' attention will later be falling on the minutes from the European Central Bank's meeting on monetary policy that are scheduled for release at 1230 GMT.

The U.K.'s FTSE 100 index rose 0.2% to 7,748.51, nudging an all-time closing high (http://www.marketwatch.com/story/ftse-100-tiptoes-around-record-high-as-banks-rise-but-home-builders-drop-2018-01-10) as banks rallied.

US gold futures for February delivery settled up $3.20, or 0.2 percent, at $1,322.50 per ounce.

Olivier Korber, a currency anaylst at Societe Generale in Paris, said a lot of bad news was priced into the pound and that its recovery in recent weeks - a 4.5 percent climb against the dollar - was mostly due to weakness in the US currency.

USD/CAD is supported at 1.2478 levels and is trading at 1.2526 levels. Stock futures pointed 0.15% lower on Wall St while shares in Europe and Asia fell modestly.

"We all know that the European Central Bank tapering is coming but now it's about the timing, and yesterday's minutes suggested there's a growing dissent among European Central Bank members about waiting too long", said ING currency strategist Petr Krpata in London.

With euro zone output eliminating spare capacity this year, policymakers argued that no further easing in financial conditions was needed, and some even warned about the European Central Bank falling behind the curve. Strong earnings from Delta Air Lines lifted it almost five percent and boosted United Continental, American Airlines and other carriers.

Robust U.S. inflation data had put some upward pressure on euro zone bond yields, but that proved fleeting in the wake of Weidmann's remarks.

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The pan-European FTSEurofirst 300 index lost 0.23 per cent and MSCI's gauge of stocks across the globe gained 0.19 per cent.

In commodities, oil prices rose for a sixth day after Russia's oil minister said global crude supplies were "not balanced yet", alleviating market concerns about a wind-down of the OPEC-led deal to reduce production.

Dow Jones closed up by 0.80 percent, S&P 500 ended up 0.70 percent, Nasdaq finished the day up by 0.79 percent. The 10-year yield eased back to 2.56% after a healthy auction of Treasurys on Wednesday.

Gold prices on Thursday approached a four-month high set on the previous day after minutes of a European Central Bank meeting showed a more aggressive tone and boosted the euro against the USA dollar.

Among other precious metals, silver rose by 0.24 percent to record $16.98 an ounce after hitting a two-week low of $16.86 on Wednesday.

The euro jumped to $1.2137, its highest level since December 2014, on news that Merkel's conservatives have reached a "breakthrough" deal with Germany's second biggest party, the Social Democrats, toward building a new coalition.

Launched three years ago, the asset purchases depressed borrowing costs, staving off the threat of deflation and putting growth on its best run since before the bloc's debt crisis. WTI crude added 25¢ (+0.4%) to $63.80/bbl.