Local Markets Commentary

The Australian market opens mid-week trade on mostly positive commodities leads, but lacklustre international equities trade and amid broad geopolitical tension.

In overnight commodities trade, oil rallied, building on Monday’s gains. US gold futures settled slightly higher. LME copper turned higher. Iron ore (China port 62% Fe) rallied for a third consecutive session.

The $A was pushed beyond $US76.35c, after trading at ~US76.20c early yesterday evening.

Locally today, Westpac and the Melbourne Institute publish their monthly consumer sentiment report 10.30am AEST.

An employment indicator is due this afternoon, and the Reserve Bank of Australia (RBA) will release card transactions.

China is expected to report June trade figures tomorrow. Some anticipate foreign direct investment (FDI) anytime from today.

Overseas Market Commentary

Major European and US equities markets mostly opened lower, or on par with, Monday’s close, US indices briefly tumbling ~two hours into trade on reports further indicating Russian support for the Trump network during last year’s presidential election.

This in turn spawned new speculation regarding the ability of the new administration to effect its proposed reforms.

Meanwhile, China objected to the US push for China to do more to contain North Korea’s nuclear weapons aspirations.

Reports emerged of the US being prepared to act independently, even in the face of South Korean opposition to the potential deployment of the US’s THAAD missile defence system, assembled in South Korea.

Among US data releases, a monthly job openings report came in sub-expectations and below the previous month’s opportunities tally.

A small business optimism index slipped 0.9 of a point from May to 103.6.

May wholesale inventories rose 0.4% for the month and sales fell 0.5%.

Meanwhile, a US Federal Reserve regional president promoted a stay on interest rate rises this year.

Tonight in the US, Federal Reserve chair Janet Yellen commences two days of parliamentary committee testimony.

The Fed’s region-by-region economic summary ‘beige book’ report is due for release, together with weekly mortgage applications.

The Bank of Canada holds a policy meeting, amid expectations of the first interest rate rise in almost 10 years.

In overnight corporate news, Snap dropped ~8%, trading well below its March IPO price.

PepsiCo exceeded June quarter expectations, but this was largely attributed to price increases.