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Market Opener – 07 May 2018
Local Markets Commentary
The Australian market commences a new week’s trade with a swag of key local and domestic reports, amid plenty of speculation regarding tomorrow’s national budget.
Overnight Friday international equities trade leads are positive.
In mixed commodities trade, US gold futures settled modestly higher. Oil rallied.
Iron ore (China port, 62% Fe) traded lower.
LME copper settled virtually flat for a second consecutive session. Nickel and aluminium turned to settle sharply higher.
The $A was pushed to ~US75.40c after trading at ~US75.20c early Friday evening.
Locally today, AiG releases its April construction sector activity index pre-trade.
NAB’s monthly business conditions and the ANZ’s job advertisements reports are due 11.30am AEST.
A weekly capital city residential property price report is also due prior to market open.
Regionally, the Bank of Japan is due to publish last month’s monetary policy meeting minutes 9.50am AEST.
China’s April forex reserves are anticipated 1pm AEST.
Overseas Market Commentary
US equities markets trended higher from early trade overnight Friday, ultimately dragging vacillating major European indices with them.
The US April employment report included the creation of 164,000 jobs, against forecasts of up to 195,000 new positions, and a 0.2% fall in unemployment to 3.9%, the lowest rate in more than 18 years.
Wages growth disappointed, estimated at just 0.1% for the month, following forecasts for a 0.2% rise after a 0.3% increase in March.
In the meantime, no definitively positive news had come out of US-China trade talks in Beijing.
Media reported that the US wish list, presented before the talks, included a $US200B reduction in the US-China trade deficit by May 2020.
Across the Atlantic, earlier data releases had seemingly sapped sentiment.
A euro zone April services PMI was reported at a healthy 54.7, but missed expectations, helping push the euro to its lowest against the $US in four months.
In addition, euro zone March retail sales improved a meagre 0.1%, against expectations of a 0.5% rise and following a 0.3% increase in February.
Germany’s 53.0 services sector activity index also undershot forecasts and represented the lowest reading in ~18 months.
Meanwhile, the European Central Bank (ECB) claimed bank stress results indicated the four major banks in Greece would suffer the equivalent of a €15.5B cut to combined capital ratios during any new economic downturn.
In Argentina, the central bank bumped its major borrowing rate from 27.25% to 40%, the third increase for the week.
Tonight in the US, a March consumer credit report is due.
Sysco Corp is among companies scheduled to report earnings or provide updates tonight.
In overnight Friday corporate news, Apple was pushed ~4% to a record peak, after it was reported that Warren Buffett had acquired an additional 75M shares.
Come Saturday, Buffett’s Berkshire Hathaway reported a $US1.1B March quarter loss, Mr Buffett explaining to investors that new accounting rules adversely impacted net income by $US6.4B.
Operating profit rose 49% to a record $US5.29B, however.
Alibaba appreciated more than 3% overnight Friday, after reporting a better-than-anticipated March quarter profit.
UK markets will remain closed today due to a public holiday.
The Australian market commences a new week’s trade with a swag of key local and domestic reports, amid plenty of speculation regarding tomorrow’s national budget.
Overnight Friday international equities trade leads are positive.
In mixed commodities trade, US gold futures settled modestly higher. Oil rallied.
Iron ore (China port, 62% Fe) traded lower.
LME copper settled virtually flat for a second consecutive session. Nickel and aluminium turned to settle sharply higher.
The $A was pushed to ~US75.40c after trading at ~US75.20c early Friday evening.
Locally today, AiG releases its April construction sector activity index pre-trade.
NAB’s monthly business conditions and the ANZ’s job advertisements reports are due 11.30am AEST.
A weekly capital city residential property price report is also due prior to market open.
Regionally, the Bank of Japan is due to publish last month’s monetary policy meeting minutes 9.50am AEST.
China’s April forex reserves are anticipated 1pm AEST.
Overseas Market Commentary
US equities markets trended higher from early trade overnight Friday, ultimately dragging vacillating major European indices with them.
The US April employment report included the creation of 164,000 jobs, against forecasts of up to 195,000 new positions, and a 0.2% fall in unemployment to 3.9%, the lowest rate in more than 18 years.
Wages growth disappointed, estimated at just 0.1% for the month, following forecasts for a 0.2% rise after a 0.3% increase in March.
In the meantime, no definitively positive news had come out of US-China trade talks in Beijing.
Media reported that the US wish list, presented before the talks, included a $US200B reduction in the US-China trade deficit by May 2020.
Across the Atlantic, earlier data releases had seemingly sapped sentiment.
A euro zone April services PMI was reported at a healthy 54.7, but missed expectations, helping push the euro to its lowest against the $US in four months.
In addition, euro zone March retail sales improved a meagre 0.1%, against expectations of a 0.5% rise and following a 0.3% increase in February.
Germany’s 53.0 services sector activity index also undershot forecasts and represented the lowest reading in ~18 months.
Meanwhile, the European Central Bank (ECB) claimed bank stress results indicated the four major banks in Greece would suffer the equivalent of a €15.5B cut to combined capital ratios during any new economic downturn.
In Argentina, the central bank bumped its major borrowing rate from 27.25% to 40%, the third increase for the week.
Tonight in the US, a March consumer credit report is due.
Sysco Corp is among companies scheduled to report earnings or provide updates tonight.
In overnight Friday corporate news, Apple was pushed ~4% to a record peak, after it was reported that Warren Buffett had acquired an additional 75M shares.
Come Saturday, Buffett’s Berkshire Hathaway reported a $US1.1B March quarter loss, Mr Buffett explaining to investors that new accounting rules adversely impacted net income by $US6.4B.
Operating profit rose 49% to a record $US5.29B, however.
Alibaba appreciated more than 3% overnight Friday, after reporting a better-than-anticipated March quarter profit.
UK markets will remain closed today due to a public holiday.