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

Heading into today’s session, the Australian market had been called to unwind approximately 19 points or 1.4% higher at 4525. As things currently stand, the market is 0.65% firmer at 4535, just off its session high of 4538.

With Chinese manufacturing PMI data over the weekend coming in at 50.6, its highest level in more than seven months, optimism is building that the Chinese economy has stabilised and may now in fact be on a slight upwards trajectory. This is clearly benefitting sentiment towards our major miners and energy stocks, with the likes of BHP, Rio Tinto and Woodside Petroleum all up between 0.4% and 0.9%. Local sentiment is also being buoyed by hopes of a rate cut by the RBA at its December meeting tomorrow.

Heading into today’s session, most economists seemed to be predicting a 25 basis-point (bps) cut to 3%, which would take the cash rate back to the lowest levels seen at the depths of the GFC. The chance of a cut has been further boosted today with the release of October retail sales data, which showed flat growth for the month, less than the 0.4% that the market had expected. On this news, the AUD slipped from levels around 1.0425 back into the low 1.0390s, but it has since recovered to be currently trading above 1.04. Regional Asian markets are also benefitting from the weekend’s Chinese data, all except the Shanghai Composite, which is continuing its recent underperformance to be 0.2% lower. The Nikkei, Hang Seng, and Kospi are all in positive territory with gains of between 0.2% and 0.7%.

Turning to today’s European session, it’s looking like a bright start across the region. Friday’s session saw European indices finish flat to slightly lower and the euro ever so slightly weaker against the dollar as traders and investors alike stood unsure as to how the ongoing fiscal cliff negotiations might play out. Trading across both equities and currencies was relatively lacklustre, as, true to form, the Democrats and Republicans traded barbs, with each side trying to paint the other as the unreasonable villain in the ongoing negotiations. Despite the ongoing antagonism, the prevailing view in the market is that some sort of deal will be struck prior to year-end, even if it is nothing more than a stop-gap measure that will buy some time for further vigorous debate in the first quarter of 2013.

With negotiations likely to be both frustrating and prolonged, equities look set to remain range-bound around current levels until a deal is struck. Again the backdrop of the ongoing fiscal cliff negotiations, European and manufacturing PMI’s will be in focus during the upcoming session, but it is the weekend’s expansionary Chinese PMI data that is set to see European markets off to a solid start. Ahead of the open we’re calling the FTSE +20 at 5886, the DAX +35 at 7440 and the CAC +18 at 3575.

www.igmarkets.com

ends


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Research: ‘Ageing Well’ Science Challenge Launched

Science and Innovation Minister Steven Joyce today launched the Ageing Well National Science Challenge, confirming initial funding of $14.6 million. More>>

ALSO:

Scoop Business: Govt Resisting Pressure To Pump More Cash Into Solid Energy

Prime Minister John Key says it is “not the government’s preferred option” to make a fresh capital injection into the troubled state-owned coal miner, Solid Energy, but dodged journalists’ questions at his weekly press conference on whether that might prove necessary... More>>

ALSO:

Lagest Ever Privacy Breach Award: NZCU Baywide Accepts “Severe” Censure In Cake Case

NZCU Baywide says that once it was found to have committed a breach of a former staff member’s privacy, it had attempted to resolve the matter... the censure and remedies for its actions taken almost three years ago are “severe” but accepted, and will hopefully draw a line under the matter. More>>

ALSO:

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news