Local Markets Commentary

The Australian market opens Friday trade on mostly negative international equities and largely positive key commodities leads.

In overnight commodities trade, oil extended Wednesday’s gains. US gold futures also continued higher. LME copper swung higher. Iron ore (China port, 62% Fe) turned lower.

The $A was pushed higher after trading at ~US73.70c yesterday evening.

Meanwhile, G7 finance ministers and central bankers meet in Bari, Italy today and tomorrow, ahead of a 26 – 27 May G7 leaders’ summit.

Overseas Market Commentary

US equities indices fell at open overnight, dragging major mainland European markets lower.

Sentiment appeared mostly pushed and pulled by mixed corporate reports and data, plus central bank pronouncements.

In US data releases, weekly new unemployment claims fell by 2000.

The April PPI was estimated 0.5% higher for the month, up 2.5% year-on-year.

Meanwhile, a Federal Reserve official warned US trade policy could damage the national economy in the longer term.

Across the Atlantic, the Bank of England maintained rates and policy during a policy meeting.

The bank’s inflation report suggested rates would remain intact, and predicted wages growth would remain weaker than inflation for up to two years, as CPI grew to 2.8% this year. This represented a 0.4% increase in the bank’s previous inflation forecast.

Moreover, consumer spending would be constrained for the remainder of 2017, and GDP growth would likely come in at 1.9% rather than the previously predicted 2.0%.

March industrial production fell 0.5% after a 0.8% drop in February and following forecasts of a further 0.4% decline.

The national goods plus services deficit came in at £4.9B, against £2.6B for February.

Tonight in the US, April CPI and retail, March business inventories, and an initial University of Michigan May consumer sentiment estimate are due.

Allianz, ArcelorMittal, Hitachi, Inpex, Isuzu, JC Penney, Lotte, Toshiba and Suzuki Motor are among companies scheduled to report earnings or provide an update today and tonight.

In overnight corporate news, US retailers Macy’s and Kohl’s appeared to impact general retail sentiment on worse-than-anticipated quarterly results, their stocks dropping ~17% and ~8% respectively.

Snap continued to drop on the previous session’s quarterly release.

Britain’s BT Group announced 4000 job cuts.

Noble Group traded up to 33% lower on a record quarterly loss.

Merck appreciated on US FDA approval of a drug developed to treat lung cancer.

In the meantime, BP, GlaxoSmithKline, Glencore, Merlin Entertainments and Sainsbury turned ex-dividend on the FTSE 100.