Local Markets Commentary
The Australian market commences Friday trade ahead of a potential vote for Australia’s next PM, and possible subsequent early national election, following generally negative leads from overnight international equities and commodities trade.

Among key commodities, oil settled slightly lower.

US gold futures and other precious metals fell.

LME copper and nickel extended Wednesday’s decline. Aluminium continued to gain.

The $A was pushed yet lower, to ~US72.50c, after tumbling below US72.90c early yesterday evening.

Locally today, another swag of large-cap companies reports earnings and several high-profile stocks trade ex-dividend. Details can be found on p4.

Regionally today, Japan was scheduled to report July CPI 9.30am AEST.

Overseas Market Commentary
Major European and US equities markets swung and chopped their way through overnight trade, as new import tariffs kicked in, in both China and the US, on $US16B worth of goods from each. 

In the meantime, the US attorney general considered it appropriate to assure the US justice department would ‘not be improperly influenced by political considerations’.

International trade angst again appeared the main reason for industrial and electronics sector stocks falling out of favour.

So, too, select currencies. Russia’s rouble and Turkey’s lira fell to two-year lows on US sanctions, and the British pound fell on government advice to business – specifically for contingency plans should a separation from the European Union occur with no firm business and trade agreements in place.

European Central Bank July policy meeting minutes underscored previous concerns regarding potentially adverse regional impacts on protectionist trade policies, but also highlighted expected ongoing economic progress in the near-term.

Germany’s initial August manufacturing and services PMIs came in at 56.1 and 55.2 respectively, from 56.9 and 54.1 in July.

The overall euro zone readings also reflected improvement in the services sector in general, but pullbacks from nonetheless strong manufacturing activity, with estimates of 54.6 and 54.4, following 55.1 and 54.2 for July.

US data releases included July new home sales, which fell 1.7% to a nine-month low, following a 2.4% drop in June.

Weekly new unemployment claims declined a further 2000, defying forecasts for an increase and representing the third consecutive week of falls.

Markit’s initial August manufacturing PMI also turned in at a nine-month low, but as with the euro zone, comparatively strong at 54.5. The 0.8-point fall surprised some, who predicted a rise to 55.0.

The services sector activity index also fell 0.8, to 55.2.

The Kansas City Fed manufacturing index came in at 14, against expectations of 23, the same as for July.

Tonight in the US, Federal Reserve chair Jerome Powell will address the annual global central bankers’ conference (hosted by the Kansas City Fed) in Jackson Hole, Wyoming. 

July durable goods orders are also due.

Companies scheduled to report earnings later today and tonight include China Merchants Bank (interim), Foot Locker, Lloyds Bank (interim), Sinopec (interim) and Yanzhou Coal Mining (interim). 

In overnight corporate news, Alibaba reported 61 higher quarterly revenue but ultimately traded 3% lower in the US. 

A $US1.5B Nordstrom buyback favoured the retailer 2%.

Specialist home products retailer Williams-Sonoma was also in favour, appreciating 16.5% on pleasing guidance and better-than-anticipated quarterly results.

Victoria’s Secret parent L Brands, however, dropped 11% after reducing full year guidance.

Numerous select markets remain closed, due to Eid observance.

UK markets will be closed Monday, due to a public holiday.