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Market Opener - 20 Feb 2017

Local Markets Commentary

The Australian market commences Monday trade with the US on a public holiday long weekend.

Overnight Friday international equities trade mostly appeared cautious.

In commodities trade, US gold futures turned lower. Oil and copper fell. Iron ore continued modestly higher.

The $A was pushed a little lower after slipping towards US76.75c early Friday evening.

Locally today, domestic reporting season continues and WES trades ex-dividend.

January sales as calculated from card purchases, plus a weekly house prices index, are also due.

Overseas Market Commentary

Faltering starts ultimately led to higher settlements for most European and US equities markets overnight Friday.

In scant data releases, UK January retail sales disappointed early, pushing the British pound lower against the $US, and favouring export stocks.

Sales had fallen 0.3% for the month and came in 1.5% higher year-on-year.

Moreover, during the January quarter, retail sales had turned to trend lower for the first time in ~three years.

US investors were faced with an apparent pushback of a promised business tax announcement until after a new health care plan is divulged next month.

Meanwhile, Greek rescue funding talks again appeared to achieve little progress, ahead of another creditor meeting set for later today.

In overnight Friday corporate news, Kraft Heinz’s proposed acquisition of Unilever pushed Kraft more than 10% higher, following a drop on disappointing sales the previous session.

Unilever appreciated 14%, even though it had rejected the plan prior to the public announcement. Kraft has since announced it has jettisoned its bid.

Sunday, China National Petroleum Corporation revealed it was outlaying $US1.8B for 8% of a key Abu Dhabi oil concession.

Meanwhile, speculation grew regarding the likely appointment of JPMorgan as lead underwriter for Saudi Aramco’s proposed IPO, and of Morgan Stanley also likely to secure a key role.

US equity and bond markets will remain closed tonight due to a public holiday. Low-volume forex trade is anticipated. Limited electronic trade available for oil and metals.

20/02/2017 6:53:37 AM

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