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GLOBAL MARKETS-European yields climb ahead of ECB, NZ$ hits five-month low

Published 2017-10-24, 05:17 a/m
© Reuters.  GLOBAL MARKETS-European yields climb ahead of ECB, NZ$ hits five-month low
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* European shares dip, yields rise after data, earnings

* NZ$ falls to 5-month lows on incoming govt's policies

* Japan's Nikkei extends 16-day winning streak

* Euro weighed by political uncertainty; ECB meets Thursday

* Graphic: World FX rates in 2017 http://tmsnrt.rs/2egbfVh

By Marc Jones

LONDON, Oct 24 (Reuters) - European stocks dipped and bond yields drifted higher on Tuesday, as data from the euro zone's top economies bolstered the case for the European Central Bank to signal a sizeable cut this week to its stimulus measures.

The latest round of global activity surveys showed German businesses enjoying their strongest jump in new orders in 6-1/2 years, banks seeing stronger credit demand and France's rebound firmly intact. misses to some of the headline forecasts kept enthusiasm in check but were not enough to stop benchmark German 10-year bond yields DE10YT=TWEB climbing to their highest in almost two weeks. GVD/EUR

The pan-European STOXX 600 .STOXX index was broadly flat meanwhile, with London's FTSE 100 .FTSE retreating 0.1 percent and Paris's CAC 40 .FCHI and Germany's DAX .GDAXI up 0.1-0.2 percent.

Apple AAPL.O supplier AMS AMS.S saw a spectacular 15 percent jump after it pointed to strong demand ahead of the iPhone X release. Strong profits from Spain's Caixabank CABK.MC also lifted the IBEX .IBEX after its Catalonia-related underperformance with a 2.3 percent rise. .EU

Asia had cheered a record-breaking 16th straight gain for Japan's Nikkei index overnight.

That kept MSCI's 47-country world share index .MIWD00000PUS near its recent all-time highs after a drop in General Electric (NYSE:GE) shares on Wall Street had seen the ViX volatility index .VIX spike up.

Major currencies mainly kept to narrow ranges. The dollar .DXY edged down from recent highs as the wait continued for Thursday's ECB meeting and for Donald Trump to name the next head of the U.S. central bank after he said on Monday a decision was "very, very close".

New Zealand's dollar stumbled to a five-month low as the incoming Labour coalition's policies unsettled investors. /FRX

Prime Minister-designate Jacinda Ardern's tough stance on foreign investment in housing and on immigration could prove negative for the currency NZD=D4 , given the country runs a current account deficit. addition, Ardern said on Tuesday her government plans to review and reform the Central Bank Act to possibly include employment, alongside inflation, as a dual target. happening so far is something that is creating uncertainty when it comes to central bank independence," said Manuel Oliveri, currency strategist at Credit Agricole (PA:CAGR).

"But you also have to keep in mind Labour did point in that direction during the election so it's not a huge surprise that they want such changes."

The kiwi, the world's 11th most-traded currency, was down 0.5 percent to $0.6930, a level not seen since May 19. NZD/

It has lost nearly 5 percent since the Labour Party secured power following an election last month.

Japan's Nikkei .N225 had extended its 16-day winning streak to a 21-year peak overnight following the weekend election win for Prime Minister Shinzo Abe.

China's blue-chip CSI300 index .CSI300 also jumped to the highest in more than two years as Beijing's ruling Communist Party moved to the final stages of a twice-a-decade congress. .T

It enshrined President Xi Jinping's political thought into its constitution, putting him in the same company as the founder of modern China, Mao Zedong, and cementing his power ahead of a second five-year term. a key Xi ally, top corruption fighter Wang Qishan will not be on the new Politburo Standing Committee, the apex of power in China. He was not among those named on the 204-member Central Committee.

In commodities, base metals were stronger, with copper futures up 1.5 percent CMCU3 .

Spot gold XAU= edged 0.2 percent lower to $1,278 an ounce, remaining near a two-week low, while Brent and U.S. crude LCOc1 CLc1 dipped to $57.21 and $51.77 a barrel respectively. O/R

Saudi Energy Minister Khaled al-Falih said on Tuesday that there was flexibility and options were open on an OPEC-led oil supply cut agreement.

Speaking to Reuters on the sidelines of a major investment conference in the capital Riyadh, Falih said there was a determination to do whatever it takes to bring oil inventories down to the five-year average but that some work remained. MSCI and Nikkei chart

http://reut.rs/2sSBRiD Developed market currencies against the Dollar

http://reut.rs/2y08bWX

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