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

 


IG Markets - Morning Thoughts


IG Markets - Morning Thoughts

Risk assets reversed losses once again driven by headlines regarding the fiscal cliff negotiations. House Speaker John Boehner’s pledge to work with President Obama was enough to help improve sentiment. There were also plenty of positive economic releases in the US including a better-than-expected GDP print and existing home sales data. The Philly Fed manufacturing index also topped estimates. However, positive US data can be a double-edged sword these days as it results in markets repricing QE expectations. Following the recent change from a calendar-based threshold to an economic data-related threshold, any positive economic data will result in markets feeling QE won’t be needed for as long as initially thought. This tends to be positive on the US dollar and in turn weighs on some risk assets like commodities. Risk currency pairs like AUD/USD and EUR/USD managed to come off their lows on somewhat improved sentiment. EUR/USD came just shy of 1.33 again, while AUD/USD retested 1.5 before both pairs retreated.

Ahead of the open, we are calling the Aussie market up 0.2% at 4641. This is just shy of yesterday’s 4643.5 high and once again would see us trading right near 15-month highs going into the end of the year. We don’t have anything to look out for on the local economic front, but we are likely to continue to hear some comments regarding the ‘surplus’ issue. Elsewhere in the region, Japan will remain in focus after the yen strengthened and the Nikkei fell despite the BoJ’s decision to increase asset purchases. As we highlighted yesterday, any dips in USD/JPY and the Nikkei are likely to be used as opportunities to buy as market participants realise just how committed to stimulating the economy the new government is. USD/JPY dropped back to 83.86 and has since recovered to 84.40 as traders buy the dips. This will be supportive of the Nikkei which fell 1.2% yesterday as the yen strengthened. We are calling the Nikkei 1.2% higher at the open.

On a stock level, we expect to see a mildly softer start for BHP Billiton, with its ADR pointing to a 0.1% fall to $37. Iron ore remained steady at 135.50 and this will be positive for the miners going into the end of the week. However, gold miners will remain under pressure today after the precious metal declined significantly. As a result, stocks like Newcrest Mining, Medusa Mining and OceanaGold are likely to lag. High yielding stocks will probably continue outperforming, particularly in the banking space. As of yesterday’s close, the local market is up 1.3% for the week and is 6.6% higher since its November 15 reversal.

Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0485 -0.0003 -0.02%
ASX (cash) 4641 7 0.16%
US DOW (cash) 13311 87 0.66%
US S&P (cash) 1442.8 11.3 0.79%
UK FTSE (cash) 5972 30 0.50%
German DAX (cash) 7686 46 0.60%
Japan 225 (cash) 10163 120 1.20%
Rio Tinto Plc (London) 34.97 -0.10 -0.29%
BHP Billiton Plc (London) 21.49 0.04 0.17%
BHP Billiton Ltd. ADR (US) (AUD) 37.00 -0.04 -0.11%
US Light Crude Oil (February) 89.89 0.45 0.50%
Gold (spot) 1649.05 -18.5 -1.11%
Aluminium (London) 2063 -18 -0.88%
Copper (London) 7772 -98 -1.24%
Nickel (London) 17488 -105 -0.60%
Zinc (London) 2322 1 0.06%
Iron Ore 135.5 0.00 0.00%

IG Markets provides round-the-clock CFD trading on currencies, indices and commodities. The levels quoted in this email are the latest tradeable price for each market. The net change for each market is referenced from the corresponding tradeable level at yesterday’s close of the ASX. These levels are specifically tailored for the Australian trader and take into account the 24hr nature of global markets.

Please contact IG Markets if you require market commentary or the latest dealing price.

www.igmarkets.com

ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Brewing: Lion To Buy Cult Upper Hutt Brewer Panhead

Lion - Beer, Spirits and Wine (NZ), New Zealand's biggest beer maker, has agreed to buy Panhead Custom Ales from the family of founder Mike Neilson, its second such purchase of a popular craft brewer after the acquisition of Dunedin-based Emerson's Brewing Co in 2012. More>>

ALSO:

Half Empty: Fonterra's 2017 Opening Forecast Below Expectations

Fonterra Cooperative Group raised its forecast farmgate milk payout for next season by less than expected as the world's largest dairy exporter predicts lower prices will crimp production and supply will pick up. The New Zealand dollar fell. More>>

ALSO:

Pest Control: Mouse Blitz Team Leaves For Antipodes

The Million Dollar Mouse project to rid Antipodes Island of mice is underway with the departure of a rodent eradication team to the remote nature reserve and World Heritage Area. More>>

Gongs Got: Canon Media Awards & NZ Radio Awards Happen

Radio NZ: RNZ website The Wireless, which is co-funded by NZ On Air, was named best website, while Toby Manhire and Toby Morris won the best opinion general writing section for their weekly column on rnz.co.nz and Tess McClure won the best junior feature writer section. More>>

ALSO:

Pre-Budget: Debt Focus Risks Losing Opportunity To Stoke Economy

The Treasury is likely to upgrade its forecasts for economic growth in Budget 2016 next week but Finance Minister Bill English has already signalled that more of his focus is on debt repayment than on fiscal stimulus or tax cuts... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news