In European Equity Markets the pan-European Stoxx 600 closed up by 0.29 percent with the various sectors moving in different directions. More notably, the main Italian index fell 2.4 percent on concerns over its future government. The FTSE 100 closed Wednesday up by 0.26, while Germany’s Dax rose 0.18 percent and the French CAC40 ended higher by 0.3 percent. Saipem bucked the struggle of fellow Italian companies to finish up by almost 12 percent. This followed a rating upgrade. Micro Focus lost some of its initial strength at the open to trade just above 6.2 percent by the end of the session. This was also after a positive trading update.

In Currency Markets the US dollar extended its rally against a basket of currencies on Wednesday to touch a five-month high, supported by relatively strong U.S. economic data in recent days, while the euro was hit by reports that a likely future Italian government would seek debt forgiveness from European creditors. Against the yen, the dollar was down 0.11 percent at 110.22 yen, but still close to the highest it has been since early February. The euro was 0.25 percent lower against the greenback at $1.1807, its lowest since December. The euro was 0.4-percent lower against the Swiss franc, after falling to a five-week low of 1.1772 francs.

In Commodities Markets oil prices slipped on Wednesday, as a strengthening dollar overshadowed a U.S. crude inventory report that showed domestic crude stocks falling more than expected. Brent crude futures were down 31 cents at $77.43 a barrel, while U.S. crude futures fell 30 cents to $71.01 a barrel. U.S. crude stocks fell last week as exports hit a new one-week record, while inventories of both gasoline and distillates fell, the Energy Information Administration said. Crude inventories fell by 1.4 million barrels in the week to May 11, compared with analysts’ expectations for a decrease of 763,000 barrels.

In US Equity Markets indexes edged higher on Wednesday, helped by gains in retail and chip stocks, while investors weighed the impact of rising bond yields. The S&P 500 was up 0.16 percent, at 2,715.81 and the Nasdaq Composite was up 24.80 points, or 0.34 percent, at 7,376.43. Micron rose 4.3 percent after RBC Capital Markets began coverage of the stock with an “outperform” rating. The Philadelphia SE semiconductor index rose 1 percent. The retailing index was boosted by a 9 percent surge in Macy’s shares after the department store operator reported strong quarterly results and lifted its full-year profit forecast.

In Bond Markets Italy’s borrowing costs held at their highest level since early March with yields posting their biggest daily rise in more than a year on reports that Italy’s 5-Star and League planned to ask the European Central Bank to forgive 250 billion euros of Italian debt. Benchmark 10-year government bond yields briefly spiked more than 17 basis points on the day, the biggest daily jump since March 2017,  to hit is highest levels since early March at 2.126 percent. The yield later pulled back slightly to trade at 2.0960 percent.