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Market Opener – 17 Aug 2018
Local Markets Commentary
The Australian market opens Friday trade following an overnight turn higher for key commodities and major international equities markets, and new data out of China.
Post-ASX trade yesterday, China reported a 19.3% year-on-year rise in July foreign direct investment (FDI), to $US7.75B.
For the calendar year-to-date, FDI has risen 5.5% year-on-year to $US76.07B.
In June, China’s FDI had grown 5.8% year-on-year.
Locally today, Reserve Bank of Australia (RBA) governor Philip Lowe delivers the bank’s half-yearly testimony to the House of Representatives’ standing committee on economics from 9.30am AEST.
RBA assistant governor (economic) Luci Ellis is scheduled to also speak publicly, at the Australian National University (ANU), Canberra, 5.30pm AEST.
In overnight commodities trade, oil and LME base metals swung higher.
US gold futures settled lower.
The $A pulled back to ~US72.60c after trading at ~US72.70c early yesterday evening.
Overseas Market Commentary
Major European and US equities markets opened higher overnight, improved sentiment ensuring positive settlements despite some notable NASDAQ and DAX 30 choppy trade.
Earlier, China responded with a qualified acceptance to a US invitation to resume trade talks, and had also reported positive investment figures.
China’s Ministry of Commerce appeared keen to point out that it was only interested in US trade discussions underscored by ‘equality and integrity’ and that China opposed ‘unilateralism and trade protectionism’.
The resumption of official discussions, reportedly later this month, will be headed by China’s vice commerce minister and the US treasury’s international affairs undersecretary.
The potential for new negotiations supported major industrial stocks overnight.
Meanwhile, Turkey’s lira continued to recover some against the $US, helping boost some confidence in the euro zone banking sector.
Among euro zone data releases, the June trade surplus was calculated at €16.7B after imports rose 8.6% and exports by 5.7%.
In the UK, July retail sales pleased, rising 0.7% for the month, following a 0.5% fall in June and forecasts of a 0.2% increase.
On a year-on-year basis, sales improved 3.5%, following forecasts of 3.0% and June’s 2.9%.
Across the Atlantic, US July housing starts were estimated 0.9% higher.
Building permits rose 1.5% for the month and 4.2% against July 2017.
A Philadelphia region manufacturing index dropped by 13.8 to 11.9, the lowest level since November 2016.
Weekly new unemployment claims came in 3000 lower than anticipated, at 212,000.
Tonight in the US, a leading economic index report from the Conference Board and an initial August consumer sentiment reading from the University of Michigan are due.
Companies due to report earnings include Deere & Co, Lithium Corp, Shandong Iron & Steel (interim), SOHO (interim), UniCredit Bank and Wynn Macau (interim).
In overnight corporate news, US retailers’ fortunes varied.
Walmart was pushed 9% higher on the best US quarterly same-store sales in 10 years, and higher full year guidance.
JC Penney slid more than 25% however, on a worse-than-feared quarterly loss.
Network specialist Cisco Systems, which had reported post-Wednesday US trade, appreciated ~3% after exceeding profit and revenue expectations.
Hedge fund buying reportedly turned online security specialist Symantec higher, by ~4.5%.
The Australian market opens Friday trade following an overnight turn higher for key commodities and major international equities markets, and new data out of China.
Post-ASX trade yesterday, China reported a 19.3% year-on-year rise in July foreign direct investment (FDI), to $US7.75B.
For the calendar year-to-date, FDI has risen 5.5% year-on-year to $US76.07B.
In June, China’s FDI had grown 5.8% year-on-year.
Locally today, Reserve Bank of Australia (RBA) governor Philip Lowe delivers the bank’s half-yearly testimony to the House of Representatives’ standing committee on economics from 9.30am AEST.
RBA assistant governor (economic) Luci Ellis is scheduled to also speak publicly, at the Australian National University (ANU), Canberra, 5.30pm AEST.
In overnight commodities trade, oil and LME base metals swung higher.
US gold futures settled lower.
The $A pulled back to ~US72.60c after trading at ~US72.70c early yesterday evening.
Overseas Market Commentary
Major European and US equities markets opened higher overnight, improved sentiment ensuring positive settlements despite some notable NASDAQ and DAX 30 choppy trade.
Earlier, China responded with a qualified acceptance to a US invitation to resume trade talks, and had also reported positive investment figures.
China’s Ministry of Commerce appeared keen to point out that it was only interested in US trade discussions underscored by ‘equality and integrity’ and that China opposed ‘unilateralism and trade protectionism’.
The resumption of official discussions, reportedly later this month, will be headed by China’s vice commerce minister and the US treasury’s international affairs undersecretary.
The potential for new negotiations supported major industrial stocks overnight.
Meanwhile, Turkey’s lira continued to recover some against the $US, helping boost some confidence in the euro zone banking sector.
Among euro zone data releases, the June trade surplus was calculated at €16.7B after imports rose 8.6% and exports by 5.7%.
In the UK, July retail sales pleased, rising 0.7% for the month, following a 0.5% fall in June and forecasts of a 0.2% increase.
On a year-on-year basis, sales improved 3.5%, following forecasts of 3.0% and June’s 2.9%.
Across the Atlantic, US July housing starts were estimated 0.9% higher.
Building permits rose 1.5% for the month and 4.2% against July 2017.
A Philadelphia region manufacturing index dropped by 13.8 to 11.9, the lowest level since November 2016.
Weekly new unemployment claims came in 3000 lower than anticipated, at 212,000.
Tonight in the US, a leading economic index report from the Conference Board and an initial August consumer sentiment reading from the University of Michigan are due.
Companies due to report earnings include Deere & Co, Lithium Corp, Shandong Iron & Steel (interim), SOHO (interim), UniCredit Bank and Wynn Macau (interim).
In overnight corporate news, US retailers’ fortunes varied.
Walmart was pushed 9% higher on the best US quarterly same-store sales in 10 years, and higher full year guidance.
JC Penney slid more than 25% however, on a worse-than-feared quarterly loss.
Network specialist Cisco Systems, which had reported post-Wednesday US trade, appreciated ~3% after exceeding profit and revenue expectations.
Hedge fund buying reportedly turned online security specialist Symantec higher, by ~4.5%.