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

It’s all about equities printing record/cycle highs at the moment. This is occurring as investors continue to respond to what seems to be a concerted effort by central banks to ease, plus a slight improvement in data from key economies. Ever since Friday’s solid non-farm payrolls numbers, global data has been on a roll, with China’s trade balance result and German factory orders/industrial production impressing yesterday. The single currency has perhaps been the biggest beneficiary of the improving economic data out of Germany. When ECB President Mario Draghi cut rates last week, he emphasised the ECB is ready to do more should economic data continue to deteriorate. As a result, the German data saw EUR/USD spike to $1.3195 before a slight pullback into the $1.316 region. AUD/USD enjoyed a strong bounce off its lows in the $1.015 region yesterday, helped by the better-than-expected China trade balance data. The pair even managed to pop back above $1.0200 early in US trade, but found sellers once again and continues to gravitate back towards Tuesday’s lows. Today is another big day for the local currency, with jobs numbers and China CPI all due out at 11.30am AEST. The unemployment rate is expected to remain steady at a three-year high of 5.6% with 11,500 jobs added. Meanwhile, China’s CPI is expected to rise 2.3% which is well under the government’s target over there and therefore is fairly good for risk. Should the jobs data turn out to be market friendly, then resistance for AUD/USD will be in the $1.0222 region, while disappointing data will probably see lows in the $1.015 region retested and possibly breached.

Ahead of the open, we are calling the ASX 200 up 0.2% at 5208. The dominant theme in yesterday’s trade was a rotation out of some of the defensive names and into the resource stocks. Seeing investors come out of their comfort zone is always a good sign, and might just be what this market needs to keep the momentum going. A situation where the banks and miners move higher in unison has been rare this year and is exactly what this market needs to breathe confidence into investors.

BHP’s ADR is pointing to a 0.9% gain to 34.60, with iron ore back above 130. Gold/copper names should also be well supported after the two metals enjoyed strong gains. The yield-play will be back in focus today with NAB reporting its first-half results. At first glance, the numbers look solid with the cash profit of $2.92 billion coming in slightly ahead of consensus at $2.91 billion. NAB’s dividend came in at 93 cents, which is also a touch ahead of estimates, but its net interest margin might disappoint analysts after coming in at 2.03%. Some analysts were expecting a net interest margin of 2.07%. ANZ Bank goes ex-div today and therefore we expect to see it underperform. News Corp (NWS) has beaten expectations in its Q3 earnings report. The fact that shares rallied nearly 4% in after-hours trade suggests good days in Australia as well, and it should continue its strong uptrend. Publishing and satellite broadcasting remain weak, however strong results were seen in cable, TV and film. On the headline Q3 EBIT grew 4%, around 10% above expectations, while adjusted EPS beat consensus by a touch at $0.35. NWS is a sold brand and ticks a lot of boxes for investors, and despite paying a low 0.9% yield it remains a standout for growth focused investors. Also keep an eye on Billabong with reports suggesting it could see a revised bid under 45 cents a share.


Market Price at 7:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0171 -0.0015 -0.15%
ASX (cash) 5208 8 0.16%
US DOW (cash) 15102 68 0.45%
US S&P (cash) 1632.4 8.5 0.53%
UK FTSE (cash) 6593 32 0.49%
German DAX (cash) 8257 65 0.79%
Japan 225 (cash) 14357 71 0.50%
Rio Tinto Plc (London) 31.01 0.29 0.94%
BHP Billiton Plc (London) 19.08 0.26 1.37%
BHP Billiton Ltd. ADR (US) (AUD) 34.60 0.30 0.87%
US Light Crude Oil (June) 96.64 0.94 0.98%
Gold (spot) 1474.05 20.9 1.43%
Aluminium (London) 1908 26 1.38%
Copper (London) 7419 154 2.12%
Nickel (London) 15404 210 1.38%
Zinc (London) 1895 22 1.17%
Iron Ore 130.2 0.2 0.15%

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

 

Strike: Lyttelton Port Workers Vote To Escalate Dispute

Members of the Rail and Maritime Transport Union (RMTU) at Lyttelton Port today voted to escalate their industrial action. Around 200 RMTU members have been operating an overtime ban since 17 December and today they endorsed a series of full withdrawals of labour at the port. More>>

ALSO:

Scoop Business: NZ Dollar Falls To 3-Year Low As Investors Favour Greenback

The New Zealand dollar fell to its lowest in more than three years as investors sold euro and bought US dollars, weakening other currencies against the greenback. More>>

ALSO:

Scoop Business: NZ Govt Operating Deficit Smaller Than Expected

The New Zealand’s government’s operating deficit was smaller than expected in the first five months of the financial year as a clampdown on expenditure managed to offset a shortfall in the tax-take from last month’s forecast. More>>

ALSO:

0.8 Percent Annually:
NZ Inflation Falls Below RBNZ's Target

New Zealand's annual pace of inflation slowed to below the Reserve Bank's target band in the final three months of the year, giving governor Graeme Wheeler more room to keep the benchmark interest rate lower for longer.More>>

ALSO:

NASA, NOAA: Find 2014 Warmest Year In Modern Record

Since 1880, Earth’s average surface temperature has warmed by about 1.4 degrees Fahrenheit (0.8 degrees Celsius), a trend that is largely driven by the increase in carbon dioxide and other human emissions into the planet’s atmosphere. The majority of that warming has occurred in the past three decades. More>>

ALSO:

Scoop Business: New Zealand’s Reserve Bank Named Central Bank Of The Year

The Reserve Bank of New Zealand’s efforts to stifle house price inflation by using new policy tools has seen the institution named Central Bank of the year by Central Banking Publications, a publisher specialising in global central banking practice. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

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