Markets quiet as traders await major announcements

10.04 AEDT, Tuesday 27 November 2012

Markets quiet as traders await major announcements

By Ric Spooner (Chief Market Analyst, CMC Markets)

The Australian market looks to be in for another quiet day’s trading with relatively flat prices.

There were really no moves of any significance in major markets last night. While US stock markets and some major commodities were a little weaker, these moves were really just minor oscillations in quiet markets that provide little in the way of a macro lead for local investors.

Markets have a couple of major news events before them in the shape of announcements on Greek bailout funding and negotiations on the US Fiscal cliff next month. The general expectation is that reasonable compromises will be negotiated on both these issues and markets are priced for this outcome. However, current valuations reflect the reality that even with these issues safely behind us, at least for the short term, developed economies face the prospect of a long hard slog of moderate growth weighed down by the government and household debt repayment. This is likely to limit the extent of positive market reaction to any announcement of a negotiated solution for Greece’s liquidity funding in the short term.
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