Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


IG Markets - Afternoon Thoughts

IG Markets - Afternoon Thoughts

FTSE 5775 -1
DAX 7214 +9
CAC 3414 +6
IBEX 7618 -6
DOW 12859 +48
NAS 2586 +13
S&P 1383 +5

Oil 85.28
Gold 1734

Asian markets are mostly lower as they track some negative leads from US and European trade. Risk assets slumped on reports a decision on releasing funds for Greece might not come until later this month. Market participants were hoping to see the current Greek uncertainty being put to bed on November 12 when European leaders meet. These reports outweighed the positive impact from better-than-expected US trade balance and unemployment claims data. China data released in the Asian session has seen some of the risk assets come off their lows. China CPI came in at +1.7%, missing a consensus of +1.9%. This leaves China officials room for easing to stimulate the economy should need be. China’s PPI was broadly in line with consensus but investors are still waiting for fixed asset investment and industrial production data due later today. This might warrant some caution ahead of the weekend when we get a further China data dump with trade balance, new loans and M2 money supply releases set to hit the wires. The Aussie dollar has been an interesting one to watch as it has seen some big moves against the USD, EUR and NZD over the past few weeks. AUD/USD briefly ventured below 1.04 early but bounced back following the RBA statement and China data. The AUD is finding its footing as the RBA’s easing cycle looks like it will pause for a while and at the same time China data is showing signs of stabilisation. The euro is currently the preferred funding currency as EUR/AUD experienced a sharp retreat from 1.28 to 1.22 over the past few weeks (8 October to 8 November).

Looking at the equities in the region, the Nikkei is lagging and is currently down 1% on the back of a stronger yen. USD/JPY slipped below 79.80 and dropped to 79.32 before stabilising. The Hang Seng is down 0.5%, while the Shanghai Composite is mildly firmer. Ahead of the European open, we are calling the major bourses relatively flat. Industrial production numbers for Germany, France and Italy will be in focus as investors continue to monitor growth in the region. Another set of disappointing figures could see the single currency extend its recent slide. EUR/USD traded at its lowest level since September 8 yesterday as negative factors continue to mount for the region. With some saying Greece will run out of funding within weeks and Spain’s bond auctions going well (hence reducing the need to imminently formally request a bailout and activate the OMT), investors will remain sceptical about buying the euro. As a result, the bounce it is currently experiencing is likely to be greeted by sellers in the 1.28 region.

The ASX 200 has dropped 0.5% to 4464 after a poor start to the day on the back of negative leads from US trade. The fact that some of the main banks are trading ex-div with a 19 point chunk being taken out of the index has not helped. As a result the financial sector is the worst performer, with Westpac dropping 3.1% and National Bank down 3.8%. In the materials space, Rio Tinto (-1.2%) and BHP Billiton (-0.8%) are both lower, but the gold miners are outperforming with Newcrest Mining rising 0.6%. China data will be on tap today with CPI, PPI, fixed asset investment and industrial production due out. Emeco Holdings (EHL) shares have slumped 17% on the back of a profit warning. First-half net operating profit guidance has been slashed to a range $23 million-$26 million, from previous guidance of $29.2 million. This implies an 11%-21% downgrade as the company suffers from lower Australian activity. Utilisation has dropped to 66%, significantly lower than an average of 91%. It’s really not too surprising, considering we have already heard from miners cutting capex. It has also been a similar trend with other mining services companies over the year. EHL shares tested 50 cents today, its lowest level since June 2010.

www.igmarkets.com.au

ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news