IG Markets - Morning Thoughts
IG Markets - Morning Thoughts
With US markets closed overnight for the Thanksgiving holiday, all eyes were on Europe where EU leaders began a two-day meeting to discuss and set the Euro bloc’s next seven-year budget. As is always the case with these EU summits, this congregation of leaders is expected to be highly fractious with their divided opinions as to the fiscal course for the region. Despite the inevitable bickering and disagreement that lies ahead, European markets managed to push modestly higher overnight on growing confidence pertaining to more immediate issues – that Greece will be granted its next bailout instalment, possibly as early as next Monday. Sentiment was also boosted by a slightly better-than-expected European manufacturing PMI print (46.2 v 45.6), and a Spanish bond auction that raised more than expected at lower yields than an earlier November auction. These positive influences followed on from an expansionary HSBC Chinese PMI print released earlier in the Asian session that appeared to confirm that the Chinese economy may have bottomed and is now stabilising.
Turning to the local market, it is looking like a fairly subdued day ahead. Given that we essentially have no US leads until Tuesday, European leaders will be tied up with Greece/European budget discussions for the next few days, and the fact that it’s a Friday, we are currently looking at a flat open with the market called to unwind around yesterday’s closing mark of 4413. Today’s expected flatness comes on the back of yesterday’s strong gains, where the ASX 200 recorded a gain of 1%, buoyed by data that Chinese manufacturing (HSBC’s unofficial survey) had moved into expansionary territory for the first time in 13 months. This created a tailwind for the resources sector, which paced gains in a broadly higher market. We are unlikely to see a repeat of yesterday, with it promising to be a quiet day as investors look ahead to next week.
Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0385 0.0003 0.03%
ASX (cash) 4411 -2 -0.04%
US DOW (cash) 12868 22 0.17%
US S&P (cash) 1394.7 -0.1 -0.01%
UK FTSE (cash) 5791 20 0.35%
German DAX (cash) 7246 32 0.44%
Japan 225 (cash) 9419 82 0.88%
Rio Tinto Plc (London) 30.11 0.14 0.45%
BHP Billiton Plc (London) 19.41 0.11 0.56%
BHP Billiton Ltd. ADR (US) (AUD) closed - -
US Light Crude Oil (January) 87.12 -0.47 -0.54%
Gold (spot) 1729.6 -1.9 -0.11%
Aluminium (London) 1945 -13 -0.67%
Copper (London) 7722 -34 -0.44%
Nickel (London) 16579 50 0.30%
Zinc (London) 2165 -35 -1.62%
Iron Ore 118.7 -1.90 -1.58%
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