Disclaimer: All information on this section is of a general nature.
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Market Opener – 25 Jul 2019
Local Markets Commentary
The Australian market commences today’s trade on mixed overnight international equities and commodities trade sentiment, ahead of keenly anticipated comments by the Reserve Bank of Australia (RBA) governor regarding policy and inflation, and with a European Central Bank policy meeting later today expected to produce further easing discussion.
RBA governor Philip Lowe’s speech is entitled Inflation Targeting and Economic Welfare and scheduled for delivery at an Anika Foundation lunch in Sydney, 1.05pm AEST.
In overnight commodities trade, oil swung lower.
US gold futures (August) turned to settle slightly higher.
Iron ore (China port, 62% Fe) also turned, closing a little lower. Further, BHP Billiton (ASX: BHP) and Rio Tinto (ASX: RIO) closed lower in London overnight, ahead of a June quarter report expected from Fortescue Metals Group (ASX: FMG) today.
LME copper swung to a gain. Nickel resumed rally mode.
The $A traded within a relatively narrow range after falling to ~US69.75c early yesterday evening.
RBA governor Philip Lowe’s speech is entitled Inflation Targeting and Economic Welfare and scheduled for delivery at an Anika Foundation lunch in Sydney, 1.05pm AEST.
In overnight commodities trade, oil swung lower.
US gold futures (August) turned to settle slightly higher.
Iron ore (China port, 62% Fe) also turned, closing a little lower. Further, BHP Billiton (ASX: BHP) and Rio Tinto (ASX: RIO) closed lower in London overnight, ahead of a June quarter report expected from Fortescue Metals Group (ASX: FMG) today.
LME copper swung to a gain. Nickel resumed rally mode.
The $A traded within a relatively narrow range after falling to ~US69.75c early yesterday evening.
Overseas Market Commentary
Trade across major European and US equities markets varied markedly overnight, investors faced with: another swag of earnings reports from avidly-followed stocks; mixed speculation regarding UK-European Union, US-China and Middle East relations; currency swings, some key late-week data; plus a European Central Bank policy meeting tonight, and further late-week influential economic indicators.
The British pound rallied against the $US and euro, and five-year US Treasuries yields rose to 1.824% from 1.791%.
Meanwhile, select FTSE-listed mining stocks fell after downgrades for Anglo American, BHP Billiton and Rio Tinto, Credit Suisse calling a top for iron ore prices.
Also in the UK, the new PM promoted his vision and began executing cabinet changes.
Among overnight data releases, initial July manufacturing and services PMI estimates for the euro zone came in at 46.4 and 53.3 respectively, from 47.6 and 53.6 in June.
Germany’s manufacturing PMI dropped to 43.1, from 45. The services sector activity index slipped by 0.4 to 55.4, nonetheless remaining well within expansion territory.
In the US, Markit manufacturing and services sector PMIs proved mixed, the manufacturing index falling by 0.6 to 50.0 and the services PMI rising by 0.7 to 52.2.
For GDP calculations, the services sector is the larger contributor.
In other overnight US data releases, June new home sales rose 7% for the month, following an 8.2% May drop.
Weekly mortgage applications fell 1.9%, despite 30-year rates reducing to 4.08% from 4.12%. Applications declined 1.1% the previous week, and could fall again ahead of the US Federal Reserve’s policy meeting next week.
Tonight in the US, a regional manufacturing index, wholesale inventories, durable goods orders and weekly new unemployment claims are due.
Elsewhere, the European Central Bank convenes a policy meeting and hosts a post-meeting press conference.
Companies scheduled to report earnings later today and tonight include: 3M, Alphabet, Amazon, Anheuser Busch InBev, AstraZeneca, Bristol-Myers Squibb, Comcast, Danone, Diageo, Intel, Lotte Chemical, Mattel, National Express, Nissan Motor, Nokia, Petrobras, Starbucks, Unilever and Volkswagen.
In overnight corporate news, Deutsche Bank reported a €3.15B June quarter net loss.
Boeing posted a $US2.94B loss, Boeing’s coming largely as a result of the 737 MAX grounding, which contributed to a 35% drop in sales (to $US15.75B) and followed a $US2.2B profit a year ago.
Caterpillar booked a $US1.62B profit, but this disappointed against $US1.71B a year earlier. Revenue rose 3% however, to $US14.4B. Costs were reported 2% higher, the company CFO citing in association $US70M worth of tariffs for the quarter.
Facebook ($US2.6B profit), Ford ($US148M profit) and Tesla ($US408M loss) have reported post-US settlement and will influence tonight’s trade.
Facebook also revealed a $US5B settlement with the US Federal Trade Commission.
The British pound rallied against the $US and euro, and five-year US Treasuries yields rose to 1.824% from 1.791%.
Meanwhile, select FTSE-listed mining stocks fell after downgrades for Anglo American, BHP Billiton and Rio Tinto, Credit Suisse calling a top for iron ore prices.
Also in the UK, the new PM promoted his vision and began executing cabinet changes.
Among overnight data releases, initial July manufacturing and services PMI estimates for the euro zone came in at 46.4 and 53.3 respectively, from 47.6 and 53.6 in June.
Germany’s manufacturing PMI dropped to 43.1, from 45. The services sector activity index slipped by 0.4 to 55.4, nonetheless remaining well within expansion territory.
In the US, Markit manufacturing and services sector PMIs proved mixed, the manufacturing index falling by 0.6 to 50.0 and the services PMI rising by 0.7 to 52.2.
For GDP calculations, the services sector is the larger contributor.
In other overnight US data releases, June new home sales rose 7% for the month, following an 8.2% May drop.
Weekly mortgage applications fell 1.9%, despite 30-year rates reducing to 4.08% from 4.12%. Applications declined 1.1% the previous week, and could fall again ahead of the US Federal Reserve’s policy meeting next week.
Tonight in the US, a regional manufacturing index, wholesale inventories, durable goods orders and weekly new unemployment claims are due.
Elsewhere, the European Central Bank convenes a policy meeting and hosts a post-meeting press conference.
Companies scheduled to report earnings later today and tonight include: 3M, Alphabet, Amazon, Anheuser Busch InBev, AstraZeneca, Bristol-Myers Squibb, Comcast, Danone, Diageo, Intel, Lotte Chemical, Mattel, National Express, Nissan Motor, Nokia, Petrobras, Starbucks, Unilever and Volkswagen.
In overnight corporate news, Deutsche Bank reported a €3.15B June quarter net loss.
Boeing posted a $US2.94B loss, Boeing’s coming largely as a result of the 737 MAX grounding, which contributed to a 35% drop in sales (to $US15.75B) and followed a $US2.2B profit a year ago.
Caterpillar booked a $US1.62B profit, but this disappointed against $US1.71B a year earlier. Revenue rose 3% however, to $US14.4B. Costs were reported 2% higher, the company CFO citing in association $US70M worth of tariffs for the quarter.
Facebook ($US2.6B profit), Ford ($US148M profit) and Tesla ($US408M loss) have reported post-US settlement and will influence tonight’s trade.
Facebook also revealed a $US5B settlement with the US Federal Trade Commission.