Most stock indices closed lower despite the solid economic data from the Eurozone. Germany's ZEW economic sentiment index increased to 54.8 in March from 53.0 in February, but missing expectations for a rise to 58.9. That was the highest reading since February 2014.

The increase was driven by lower oil prices and a weaker euro. Greek debt talks and the Ukraine conflict continue to weigh on sentiment.

Eurozone's ZEW economic sentiment index rose to 62.4 in March from 52.7 in February, beating expectations for a gain to 58.2.

Eurozone's consumer price index rose 0.6% in February, after a 1.6% decrease in January.

On a yearly basis, Eurozone's final consumer price inflation remained unchanged at 0.3% in February, in line with expectations.

Eurozone's consumer price inflation excluding food, energy, alcohol and tobacco rose to an annual rate of 0.7% in February from a previous estimate of 0.6%. Analysts had expected the index to remain unchanged at 0.6%.

Market participants are anxious that the Fed will drop the word "patient" from its outlook for monetary policy in its March meeting.

Indexes on the close:

Name Price Change Change %

FTSE 100 6,837.61 +33.53 +0.49 %

DAX 11,980.85 -186.87 -1.54 %

CAC 40 5,028.93 -32.23 -0.64 %

The European Central Bank President Mario Draghi said in a speech to a finance conference in Frankfurt on Monday that an economic recovery is taking hold in the Eurozone thanks in part to the central bank's quantitative easing. He urged governments to implement reforms that would improve the Eurozone's long-term growth prospects.

"Confidence among firms and consumers is rising. Growth forecasts have been revised upwards. And bank lending is improving on both the demand and supply sides," he added.

Mr Draghi noted that the Eurozone's economy benefited from lower oil prices and a revival in bank lending.

Statistics Canada released manufacturing shipments on Tuesday. Canadian manufacturing shipments dropped 1.7% in January, missing forecasts of a 1.1% decrease, after a 1.6% increase in December.

December's figure was revised down from a 1.7% rise.

The decline was driven by a drop in sales of petroleum and coal products. Sales of petroleum and coal products plunged 11.9% in January. It was the biggest one-month drop since 2008.

Sales of motor vehicles decreased 2.0%, while sales of machinery dropped 8.9% in January.

Food sales declined 1.7% in January.

Sales declined in 14 of 21 categories.

The U.S. Commerce Department released the housing market data on Tuesday. Housing starts in the U.S. dropped 17.0% to 897,000 annualized rate in February from a 1.081 million pace in January, missing expectations for a decrease to 1.050 million. It was the lowest level since January 2014.

January's figure was revised up from 1.065 million units.

The decline was driven by bad weather in the U.S.

Building permits in the U.S. increased 3.0% to 1.092 million annualized rate in February from a 1.06 million pace in January. Analysts had expected building permits to climb to 1.07 million units.

Starts of single-family homes dropped 14.9% to 539,000 units in February. Building permits for single-family homes declined 6.2% to 620,000 units.

Starts of multifamily buildings plunged 20.8% to 304,000 units in February. Permits for multi-family housing increased 18.3% to 472,000 units.

U.S. stock-index futures maintained losses as housing starts last month fell the most in four years before a Federal Reserve decision on interest rates.

Global markets:

Nikkei 19,437 +190.94 +0.99%

Hang Seng 23,901.49 -48.06 -0.20%

Shanghai Composite 3,503.72 +54.42 +1.58%

FTSE 6,821.26 +17.18 +0.25%

CAC 5,022.05 -39.11 -0.77%

DAX 12,024.98 -142.74 -1.17%

Crude oil $43.14 (-1.71%)

Gold $1151.00 (-0.20%)

(company / ticker / price / change, % / volume)

Upgrades:

Downgrades:

Other:

General Motors (GM) target raised from $43 to $45 at Argus

Facebook (FB) target raised from $90 to $96 at Nomura

European indices turned negative during the day after a set of important Eurozone data with the DAX retreating 1.6% coming from fresh all-time highs and falling under the 12,000 points mark.

Yesterday Italy's central bank Governor Ignazio Visco said that he is concerned over the drop of the single currency as a consequence of quantitative easing launched by the ECB and that he has doubts about the effectiveness of the program.

Economic Sentiment of the largest economy in the Eurozone further improved and rose for a fifth month suggesting further recovery in Germany in the next 6 months. The ZEW Center for European Economic Research reported an increase from 53.0 to 54.8 points for the month of February - although below estimates of an increase to 58.9 points. The Sentiment improved as a consequence of lower oil prices and a lower euro, trading near 12-year lows against the greenback, boosting export-heavy sectors and fuelled consumption. The quantitative easing, started last week on Monday, further stimulated the economy.

ZEW Economic Sentiment for the whole Eurozone rose more-than-expected from a previous reading of 52.7 to 62.4. Analysts expected the index to rise to 58.2.

Eurozone's Employment Change came in at +0.1% for the fourth quarter, in line with expectations.

The Harmonized CPI for February rose +0.6% month on month with a previous reading of -1.6%.

Eurozone's February Inflation was confirmed and unchanged from a previous estimate at -0.3%. Consumer prices, excluding the volatile energy and food items costs, came in at +0.7%, +0.1% higher than the previous reading and the estimates.

The commodity heavy FTSE 100 index is currently trading flat quoted at 6,801.37, boosted by gains in the mining sector. Germany's DAX 30 slumped -1.6% trading at 11,969.29 points. France's CAC 40 is currently trading at 5,016 points, -0.90%.

Economic Sentiment of the largest economy in the Eurozone further improved and rose for a fifth month suggesting further recovery in Germany in the next 6 months. The ZEW Center for European Economic Research reported an increase from 53.0 to 54.8 points for the month of February - although below estimates of an increase to 58.9 points. The Sentiment improved as a consequence of lower oil prices and a lower euro, trading near 12-year lows against the greenback, boosting export-heavy sectors and fuelled consumption. The quantitative easing, started last week on Monday, further stimulated the economy.

ZEW Economic Sentiment for the whole Eurozone rose more-than-expected from a previous reading of 52.7 to 62.4. Analysts expected the index to rise to 58.2.

BLOOMBERG

When Yellen Gets Less Predictable She's Getting Back to Normal

(Bloomberg) -- Janet Yellen wants to be less predictable, if only a little.

Should the Federal Reserve this week jettison a promise to remain "patient" about raising interest rates, as anticipated by economists, the omission will mark the end of an era in Fed communications policy and could usher in a period of greater market volatility.

Beginning in June, and for the first time since 2008, officials would be making rate decisions meeting-by-meeting, based purely on the data in front of them, rather than committing themselves to keeping borrowing costs low.

Source: http://www.bloomberg.com/news/articles/2015-03-17/when-yellen-gets-less-predictable-she-s-getting-back-to-normal

BLOOMBERG
China's Swaps Drop Most in Six Weeks as Central Bank Cuts Yield

(Bloomberg) -- China's interest-rate swaps dropped the most in six weeks after the central bank cut a short-term lending rate for the second time this month, helping counter a slowdown in the world's second-largest economy.

The People's Bank of China said it auctioned seven-day reverse-repurchase agreements at 3.65 percent, down from 3.75 percent last week. The rate was also lowered by 10 basis points on March 3, two days after benchmark interest rates were reduced for the second time in three months. Capital outflows are complicating efforts to bring down borrowing costs as the economy expands at the slowest pace in two decades.

The cost of one-year swaps, the fixed payment to receive the floating seven-day repurchase rate, fell 13 basis points to 3.63 percent as of 4:38 p.m. in Shanghai, data compiled by Bloomberg show. That's the biggest drop since Feb. 4. The rate climbed to 3.83 percent earlier, the highest level since July.

Source: http://www.bloomberg.com/news/articles/2015-03-17/china-s-rate-swaps-retreat-as-pboc-cuts-yield-on-reverse-repos

REUTERS
Brent comes off 6-week low to rise above $54, but glut worries drag

(Reuters) Brent Crude rose above $54 a barrel in choppy trade on Tuesday, recovering some of the previous session's losses when it hit a six-week low, but concerns over a growing supply glut kept a lid on gains.

Prices on the other side of the Atlantic fell for a sixth session to just above a six-year low, keeping their discount to Brent at near $10, a trend that analysts say could deepen.

"The oil market is currently oversupplied, driven in part by the success of North American shale," Morgan Stanley said.

While the U.S. rig count has dropped from 1,809 rigs a year ago to 1,125 last week, past cycles have shown there is "often a lag between when drilling stops and when oil supply stops growing", the bank said in a note.

Source: http://www.reuters.com/article/2015/03/17/us-markets-oil-idUSKBN0MD0AH20150317

European stocks open mixed on Tuesday ahead of a set of important Eurozone data that will be published at 10:00 GMT including the Employment Change, ZWE Economic sentiment, Harmonized Consumer Price Inflation and the German ZEW Sentiment. Yesterday Italy's central bank Governor Ignazio Visco said that he is concerned over the drop of the single currency as a consequence of quantitative easing launched by the ECB and that he has doubts about the effectiveness of the program.

The commodity heavy FTSE 100 index is currently trading +0.60% quoted at 6,844. Germany's DAX 30 is trading flat at 12,161.64 points, well above the psychologically important mark of 12,000 points. France's CAC 40 is currently trading at 5,071.66 points, +0.20%.

U.S. stocks rebounded on Monday helped by a weaker greenback easing. Now all eyes are on the FED's policy meeting to get a clearer signal on when the bank is planning to hike benchmark interest rates. U.S. economic data reported yesterday was weaker-than-expected. The NAHB housing market index declined to 53 in March from 55 in February. It was the third consecutive decline. The U.S. industrial production increased 0.1% in February, missing expectations for a 0.3% rise, after a 0.3% drop in January. The NY Fed Empire State manufacturing index declined to 6.90 in March from 7.78 in February, missing expectations for a rise to 8.1.

The S&P 500 closed +1.35% with a final quote of 2,081.19 points. The DOW JONES index added +1.29% closing at 17,977.42 points.

Chinese stocks continued to add gains on Tuesday but closed mixed. Hong Kong's Hang Seng is trading lower after a higher opening -0.23% at 23,893.97 points. China's Shanghai Composite closed at 3,503.72 points closing +1.58% - up for a fifth consecutive day reaching the highest level since June 2008. Markets were supported by Premier Li Keqiang comments on Sunday to further stimulate the economy if necessary.

The Nikkei could extend its 15-year closing high on Tuesday. The index closed +0.99% with a final quote of 19,437.00 points lifted by strong gains on Wall Street and Europe. The Bank of Japan held rates steady at 0.10% and the Monetary Base Target at 275 with an 8 to 1 vote and revised its inflation outlook on lower oil prices.

(index / closing price / change items /% change)

Nikkei 225 19,246.06 -8.19 -0.04 %

Hang Seng 23,949.55 +126.34 +0.53 %

Shanghai Composite 3,449.3 +76.39 +2.26 %

FTSE 100 6,804.08 +63.50 +0.94 %

CAC 40 5,061.16 +50.70 +1.01 %

Xetra DAX 12,167.72 +266.11 +2.24 %

S&P 500 2,081.19 +27.79 +1.35 %

NASDAQ Composite 4,929.51 +57.75 +1.19 %

Dow Jones 17,977.42 +228.11 +1.29 %