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Market Opener – 08 Jan 2018

Local Markets Commentary
The Australian market commences a new week’s trade following a strong finish to weekly international equities trade overnight Friday.

Overnight Friday commodities trade proved mixed, however.

Oil fell. US gold futures settled slightly higher. Iron ore (China port, 62% Fe) continued higher, beyond $US76.5/t. LME copper, nickel and zinc were pushed lower. 

The $A rose to ~US78.65c, after falling to ~US78.40c early Friday evening.

Locally today, a December construction sector activity index and weekly residential property prices are due pre-trade.

Post-trade, the Reserve Bank of Australia (RBA) is scheduled to release December official reserve assets.

Regionally, December foreign direct investment (FDI) figures are due out of China anytime from today.

Foreign exchange reserves were reported over the weekend at $US3.14 trillion, representing a monthly $US20.2B gain, and an 11th consecutive monthly rise.

In addition, extreme winter weather reportedly damaged food crops in central and northern China.

Overseas Market Commentary
Major European and US equities markets advanced further overnight Friday, amid mixed US data, falling oil prices and favourable tech sector sentiment. Several key indices on both sides of the Atlantic achieved new peaks.

Among US data releases, the December employment report revealed 148,000 jobs were created during the month and that average earnings rose 0.3% for the month and 2.5% on an annual basis.

Unemployment remained at 4.1%.

The ISM services sector activity index disappointed, coming in at 55.9, against 57.4 for November.

November factory orders rose 1.3%, following a 0.4% gain in October, which had initially been reported as a slight pullback.

The November trade deficit was estimated at $US50.5B, compared with $US48.9B for October.

Among Federal Reserve officials who spoke publicly, one deemed two rate rises necessary during 2018. Another predicted an inflation bounce.

Tonight in the US, November consumer credit figures and an economic optimism index are due.
8/01/2018 7:05:00 AM

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