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

 


IG - afternoon thoughts and European opening calls 4/12/12

Heading into today‘s session we had been predicting the ASX 200 to open modestly weaker, with the benchmark index called down 7 points or 0.15% at 4524. As things currently stand, the market is 10 points or 0.2% lower at 4521, with most sector indices marginally in the red. While a softer open was always on the cards this morning based on US leads, most of the day’s action was expected to have come this afternoon after the RBA rates decision. However, in cutting rates by 25 basis points as was widely predicted, the market’s reaction has been absolutely minimal, with the ASX 200 remaining essentially unchanged. Based on a string of recent weak data points, such as capex spending, job ads, retail sales and building approvals, a multitude of international uncertainties spanning Europe, China and the US and a stubbornly high AUD, it seemed the RBA felt compelled to act with additional easing measures. Yesterday’s flat October retail sales print (against estimates of 0.4% growth) would appear as confirmation that retailers, despite the string of rate cuts in recent months, are yet to see any material improvement in consumer spending. The Christmas shopping season is a crucial period for all retailers, where some make more than 40% of their annual profits, so a buoyant consumer is critical to their bottom-line performance. Shares of the big department stores as well as the likes of discretionary retailers such as Harvey Norman and JB Hi-Fi are mixed after today’s decision. Turning to the European session, yesterday we saw European equities finish marginally higher and the euro modestly firmer against the dollar, with advances driven by a fall in peripheral European debt yields, brought about by Greece announcing details of its debt buyback program. The debt buyback, by way of a Dutch auction, is a key component in the efforts of lenders to put Greece’s debt levels back on sustainable footing and will enable the indebted nation to receive crucial bailout funding to allow it to stave off bankruptcy. While not a definitive solution, any form of debt forgiveness will ease the burden on Greece’s finances and help to ensure it does not have to keep returning to the international lending community for bailout funding. This positive development was offset by a weaker-than-expected US manufacturing PMI print (49.5 versus 51.3 consensus), ensuring gains across European equities and the euro itself were marginal at best. On today’s economic calendar we have Spanish unemployment, European PPI and UK construction PMI to look forward to; however, as is now the norm, headlines surrounding the fiscal cliff are likely to be the major influences of market sentiment. Ahead of the European open we’re calling the FTSE -14 at 5857, the DAX -23 at 7412 and the CAC -7 at 3559.

ENDS

www.igmarkets.com

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

OceanaGold: Man Killed In Waihi Mine Accident

A 29-year-old man had died following a work place accident at OceanaGold mine, Waihi last night. The man was killed after the front end loader he was in rolled down a slope. The accident happened at approximately 6.30pm on Thursday night. More>>

ALSO:

Constructing Consent: Annual Housing Consents Highest In Over A Decade

More than 29,000 new homes gained building consent in the year to June 2016, up 16 percent from the previous June year, Statistics New Zealand said today. More>>

ALSO:

War Against Weevil For Future Peas: “No Peas, No Weevil” Ban Now In Place In Wairarapa

The Ministry for Primary Industries (MPI) has today placed a ban on growing peas within a specified area and placed controls on moving pea material (seed and untreated pea straw) within, in and out of this area for the next 2 years. More>>

ALSO:

Wood Producers: Crisis In New Zealand Log Supply

New Zealand wood processing leaders held a hui with senior government officials and political leaders in Whangarei yesterday to assess the acute log supply shortage to local mills in Northland. More>>

Consents And Taxes: Trustpower 'Very Disappointed' With Judgement

Trustpower is "very disappointed" with a Supreme Court ruling dismissing its bid to claim tax deductions on $17.7 million of project costs in a case closely watched by large-scale infrastructure developers. More>>

ALSO:

Fruitful Endeavours: Kiwifruit Exports Reach Record Levels

In June 2016, kiwifruit exports rose $105 million (47 percent) from June 2015 to reach $331 million, Statistics New Zealand said today. Overall, goods exports rose $109 million (2.6 percent) in June 2016 (to $4.3 billion). More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news