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Market Opener - 21 Jul 2017

 
Local Markets Commentary

The Australian market commences Friday trade with little support from key commodities, on largely unconvincing international equities leads, and in the absence of economic indicator catalysts.

In overnight commodities trade, US gold futures resumed their ascent following an on-par close Wednesday. Oil settled lower. LME copper extended Wednesday’s fall a little. Iron ore swung lower.

The $A climbed again, after being pushed lower towards ~US79.0c early yesterday evening.

Locally today, two speeches by Reserve Bank of Australia (RBA) officials are keenly anticipated for any commentary regarding yesterday’s national employment statistics.

Overseas Market Commentary

Major European and US equities markets opened higher overnight, but corporate earnings and news, currency swings, plus oil reaching and falling from seven-week peaks, produced vacillations from which some indices failed to recover.

The European Central Bank (ECB), as expected, did not make any changes at its policy meeting.

ECB president Mario Draghi, in the post-meeting press conference, reiterated economic indicators remained the key to any tightening, and that they did not yet point to near-term adjustment.

This included for the monthly €60B bond purchase program, which Mr Draghi said could extend into next year, but which would be considered in detail in Autumn. The euro subsequently maintained a significant pre-meeting appreciation.

Earlier yesterday, the Bank of Japan had also maintained status quo and indicated it would do so for some time, again pushing back the timetable for target inflation.

In data releases, US weekly new unemployment claims dropped by 15,000 and the four-week moving average by 2250.

The July Philadelphia Fed manufacturing index tumbled eight points to 19.5, ahead of national updates from next week.

June retail sales surprised on the upside in the UK, rising 0.6% for the month, despite a 1.3% fall for the quarter. Warmer than usual weather was cited for improved apparel and household goods sales.

In the meantime, the International Monetary Fund (IMF) was reported to have imposed a Greek debt cap as a condition for approving the further release of bailout funds.

Tonight in the US, no new major economic data releases are anticipated.

Colgate-Palmolive, General Electric, Honeywell, Schlumberger, Tokyo Steel and Vodafone are among companies scheduled to report earnings or provide trading updates.

In overnight corporate news, Unilever’s pleasing interim results supported general consumer stocks.

Sears revealed a deal to sell select Kenmore products through Amazon, skittling home goods and improvement retail stocks however.

Exxon Mobil received a $US2M US treasury penalty for breaching sanctions against Russia in 2014. The group was headed at that time by current US secretary of state Rex Tillerson.

 
21/07/2017 7:45:31 AM

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