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Research

Disclaimer: All information on this section is of a general nature.
Before making any investment decision, you should consult your adviser.

Market Opener – 10 Jan 2019

 
Local Markets Commentary
The Australian market commences today’s trade ahead of influential data out of China, following overnight key commodity price gains and positive settlements again across major international equities indices.

China is expected to report December CPI and PPI 12.30pm AEDT, following confirmation that three days of US-China trade talks in Beijing have concluded.

Commentary out of China regarding any definitive outcomes from the trade discussions could sway some sentiment today.

Locally today, a NAB business confidence report is expected.

In addition, BHP trades ex-dividend.

In overnight commodities trade, oil settled sharply higher.

Iron ore (China port 62% Fe fines) swung lower.

US (February) gold futures seesawed higher.

LME copper also turned and rallied. 

The $A appreciated to ~71.75c after approaching US71.60c early yesterday evening.

Overseas Market Commentary
Choppy trade featured across major European and US equities markets overnight, but key indices opened and settled higher.

Select tech, energy and manufacturing stocks were again supported, as reports emerged that China had vowed to increase imports of some US agricultural and energy products, plus manufactured goods, during three days of US-China trade talks which ended in Beijing yesterday.

US Federal Reserve December policy meeting minutes revealed some members had counselled against a December 2018 rate rise and that most agreed a slower pace of increases was likely warranted during 2019. This was due to views of ‘more pronounced’ risk.

This kept the $US lower (as much as -0.7% intra-session) and government bond yields higher through overnight trade.

Also in the US, the deputy attorney-general was reported to be leaving his position within weeks, when the confirmation process for the president’s new attorney-general nomination (William Barr) is due to be completed.

The US president repeated a threat of declaring a national emergency should Congress not approve in the near-term ~$US5B worth of funding for a Mexico-US border wall, and walked out of new negotiations.

Across the Atlantic, the UK parliament debated European Union (EU) withdrawal plans, the House of Commons voting (308 – 297) for an amended plan to be presented within three sitting days should the current one be defeated in a scheduled vote Tuesday next week.

Meanwhile, Bank of England governor Mark Carney assured the central bank would remain pro-active following the UK’s withdrawal from the EU, but would also act in a considered and’ prudent’ manner.

In overnight data releases, a US Investment Company Institute report estimated a net $US30.4B had been withdrawn from US-based mutual and exchange-traded funds during the week to 2 January. This included $US14.2B from bond investments and $US11.3B from stocks.

Weekly mortgage applications were reported to have jumped 23.5%.

Germany’s November trade surplus rose to €20.5B from €18.9B at the end of October. 

Exports pulled back 0.4% for the month however, following a 0.9% October increase.

Imports fell 1.6% after rising 0.8% in October and against forecasts of a flat November.

The euro zone reported a 0.1% slip in unemployment to 7.9%. 

Tonight in the US, weekly new unemployment claims are scheduled for release.

Elsewhere, the European Central Bank (ECB) releases policy meeting minutes.

Marks & Spencer, Premier Oil and Tesco are among companies expected to report earnings or provide trading updates.
 
10/01/2019 7:00:00 AM

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