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Market Opener - 03 Jul 2017

 
Local Markets Commentary

The Australian market commences a new financial year’s trade with some influential regional data and a swag of domestic economic indicators ahead of the Reserve Bank of Australia’s (RBA) policy meeting tomorrow.

Any developments from a planned teleconference between the leaders of the US, China and Japan, featuring North Korea nuclear activity, international steel trade and China Sea sovereignty, could also influence sentiment.

In addition, 4 July holiday disruption to US markets will be kept in mind.

Locally today, AiG’s June national manufacturing index, the ANZ’s monthly job advertisements survey, the Melbourne Institute/TD Securities monthly inflation report, May building approvals, and a capital city house price report for last week and also June are due.

The RBA will publish June commodity prices post-trade.

Regionally, Caixin releases its final June manufacturing PMI for China 11.45am AEST.

Japan publishes the influential quarterly Tankan survey, including snapshots of both large and small manufacturing and service sector activity. This is expected 9.50am AEST.

In overnight Friday commodities trade, oil continued its current climb, picking up the pace from Thursday’s trade. US gold futures continued to decline. LME copper settled almost flat. Premium iron ore (China port, 62% Fe) continued to rise.

The $A rose to ~US76.90c after trading past US76.80c again early Friday evening.

Overseas Market Commentary

US markets are heading into a shortened trading week, due to 4 July Independence Day commemorations.

The NYSE, NASDAQ, NYMEX and COMEX will close early tonight.

The NYSE and NASDAQ will remain closed tomorrow night. NYMEX and COMEX will trade, but again close early.

Full trade resumes across all exchanges Wednesday.

Overnight Friday, major European and US equities markets reacted to influential economic indicators, amid half-yearly and quarterly positioning and ahead of peak summer holiday season.

The euro zone’s initial June CPI represented 1.3% year-on-year growth, following 1.4% for May.

Germany reported 0.5% and 4.8% respective monthly and annual rises for May retail sales, following 0.2% and 0.4% declines in April.

In the UK, a final March quarter GDP reading confirmed the initial 2.0% year-on-year and 0.2% quarterly growth estimates.

Among mixed data releases in the US, a core private consumption index was reported 1.4% higher year-on-year for May, against 1.5% in April.

Personal income and spending rose 0.4% and 0.1% respectively.

Savings were reported 5.5% higher, from 5.1% in April.

The June Chicago PMI came in at 65.7, following forecasts of just 58 and 6.3 points above May’s reading.

A 95.1 final June University of Michigan consumer sentiment reading represented a 0.6-point rise from the initial estimate, but a two-point fall for the month.

Tonight in the US, ISM’s June manufacturing index is due, together with May construction spending and Markit’s final June manufacturing PMI.

The presidents of China and Russia, Xi Jinping and Vladimir Putin respective, meet in Russia at the commencement of a two-day official visit by the Chinese leader.

In Japan, final results will be assessed from a closely-watched ‘city assembly’ election, which potentially bolsters general election prospects for a rival of prime minister Shinzo Abe.

Meanwhile, Middle East relationships will remain in focus following Qatar’s defiance of demands from key neighbours.

In overnight Friday and weekend corporate news, French petroleum major Total unveiled a proposed plan to invest $US1B in gas exploration and development in Iran.

Nike quarterly results, boosted by $US8.7B in sales revenue, appeared to please, supporting DJIA trade in particular.

In addition, Nike and Amazon confirmed select Nike products would become available via Amazon.

 
3/07/2017 7:51:57 AM

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