Local Markets Commentary

The Australian market commences mid-week trade on negative equities leads, but also some commodity price rallies, ahead of a US Federal Reserve policy statement early tomorrow (AEDST).

In overnight commodities trade, gold futures and copper rallied. Oil continued lower and iron ore higher.

The $A slipped after trading at US76.70c yesterday evening.

Locally today, September building approvals and a report on September quarter living costs are due from the ABS.

Japan’s markets will be closed tomorrow, due to a public holiday.

Overseas Market Commentary

Major European and US equities markets traded decisively lower overnight.

Political uncertainty appeared a major factor, two different US polls favouring a different presidential nominee, ahead of official polling day Tuesday next week.

In US data releases, ISM’s October manufacturing index rose 0.4 to 51.9 and Markit’s final October manufacturing PMI came in at an encouraging 53.4.

September construction spending declined 0.4%, following expectations of a 0.5% turn higher after the same proportional swing lower in August.

October vehicle sales dropped 6%.

Tonight in the US, the policy statement from a two-day Federal Reserve policy meeting is keenly anticipated (early AEDST), in particular clues regarding a possible December rate rise.

In addition, a private sector employment report is due, ahead of Friday’s October national employment report. Weekly mortgage applications will also be reported.

21st Century Fox, Alibaba Group, AIG, Facebook, Mazda Motor, Mitsui, Sojitz, Time Warner and Yamaha Motor are scheduled to report earnings and/or provide trading updates today and tonight.

Overnight, BP reported a £763M quarterly profit, against almost double that a year ago. Nonetheless it was the first profit in a year and a35% improvement on the previous quarter.

Royal Dutch Shell achieved an 18% higher, $US1.4B profit, against a $US6.1B loss a year ago, but also warned on prices and margins.

Kellogg said reduced US and UK demand pushed sales 2.3% lower, but one-off cost reductions supported a profit.

Pfizer and Shire outlooks each disappointed.

General Motors’ October US sales fell 1.7%, but this was less than feared. Fiat Chrysler’s dropped 10%. An office fire meant Ford will not report until next week

Meanwhile among the large Asian vehicle manufacturers, Honda’s US sales fell 4.4%, Nissan’s 2.2% and Toyota’s 8.7%.