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

 


Onwards and upwards theme continues for financial markets

15.09 AEDT, Wednesday 30 January 2013

Onwards and upwards theme continues for financial markets


By Tim Waterer (Senior Trader, CMC Markets)

Buying momentum continues to be on the side of higher yielding assets, with traders clearly liking what they are seeing in terms of both macro indicators and corporate earnings. Apart from the occasional blip such as the most recent US Consumer Confidence reading, by and large the economic indicators are building a strong case for global economic recovery and the prices of risk assets are responding accordingly. However, the case for economic recovery faces stern cross examination in the form of the US Non-farm Payrolls report come Friday.

The bar is set almost embarrassingly low for the vast majority of key macro indicators for the US, and anything mildly positive is serving to feed more buying enthusiasm. The prevailing market psyche is easily pleased, with traders relieved to see evidence of mild US growth rather than worrying about the headlines from 2012 mostly revolving around Greece. The major US indices are hitting multi-year highs and there could still be more to come while ever data is supportive of the ‘growth’ narrative, which has been the central theme of financial markets so far in 2013.

The Australian sharemarket operated in nonchalant fashion today, with the local bourse touching the 4900 level while also consolidating Tuesday’s bumper gains. Today it was the turn of Materials stocks to push higher with commodity prices having enjoyed a positive offshore session overnight. Meanwhile, banking stocks took what looked like a rest day after their recent push. The story for the ASX200 so far in 2013 has been ‘onwards and upwards’, and while history tells us that the golden run will eventually end, in this instance we could be seeing the 5000 level reached on the index before a pullback happens. Trading conditions remain conducive to the search for yield and this is likely to continue while macro indicators globally show signs of progression.

Tuesday’s NAB Business Confidence reading came at just the right time for the AUD which had looked likely to again slip below 1.04. Confirmation today of an Australian election in September had little impact on the currency with the AUD mostly spending time in the 1.0450-1.0470 range. While the AUD has enjoyed a solid 24 hours based on the more positive outlook from domestic businesses, the fate of the AUD for the remainder of the week could well lie with how US jobs data pans out on Thursday and Friday, and more specifically, by how the US Dollar reacts to the data.

ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news