Wall Street fluctuated between gains and losses but managed to closed higher at the end of the day with DJIA and S&P 500 gaining +0.71% and +0.63% respectively. European bourses slipped across the board with the Stoxx600 index slipping around -0.6%. In the commodity sector, crude oil gained with the benchmark WTI contract rising for a 4th consecutive to 96.11 before settling at 95.52, up +1.34%, and the equivalent Brent crude contract surging to a 2-month high of 115.23 before ending the day at 114.56, up +2.31%. Safe-haven demand for gold returned with the yellow metal gaining +1.99% to 1791.1.

Political and fiscal developments in the Eurozone continued to grab the headline. Italian government debt surged to a record high amid worries about parliamentary vote of the 2012 budget. In Greece, the president released a statement announcing that a new coalition government will be formed with the aim to 'immediately lead the country to an election after the decisions of October 26 have been implemented'. France announced additional fiscal-consolidative policy but it failed to tame yield spread from widening.

Italian newspapers said that the government might have lost a majority in the lower house, making it difficult to pass the 2012 budget which will be voted again today. There is possibility for early elections for the government. If that's the case, elections would probably delay structural reforms and would put the country at hard times as the next redemption will be in 1Q2012. A new government will be formed in Greece and elections will probably take place in mid-February. However, the progress of formation of the new interim government has been slow. The opposition party is hesitant amid concerns that its supporters would think that it supports the austerity measures. France unveiled an additional austerity package worth of 7B euro. The government forecast that this should help reduce the fiscal deficit to 4.5% of GDP by 2012 after the economic growth forecast is lowered to +1.0% from +1.75%..

On the macro front, data released in the 17-nation Eurozon was disappointing. Sentix investor Confidence index slipped to -21.2 in November from -18.5 a month ago. The market had anticipated a milder drop to -20. Retail sales contracted -0.7% m/m in September following an upwardly revised reading of +0.1% in August. German industrial production contracted -2.7% m/m in September, deteriorating from -1% a month ago.

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