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Market Opener – 25 Sep 2017
Local Markets Commentary
The Australian market opens a new week’s trade on: scant support from overnight Fridayinternational trade; a post-trade UK credit rating downgrade; political election uncertainty in Germany and New Zealand; and heightened US-North Korea tension.
In overnight Friday commodities trade, US gold futures and WTI crude settled slightly higher. Brent crude appreciated with comparative conviction. LME copper continued lower and nickel to drop. Iron ore also extended its current slide.
The $A vacillated after trading at ~US79.55c early Friday evening.
Locally pre-trade, a weekly capital city residential property price report is due.
Regionally, Bank of Japan governor Haruhiko Karoda is scheduled to speak publicly in Osaka at 3.30pm AEST. A September preliminary manufacturing PMI is expected this morning.
Election results could influence some regional trade sentiment today, with some caution considered possible ahead of northern hemisphere market reaction to outcomes in Germany later today and tonight.
In Germany, the ruling party will need to form a different coalition from previously, but still under chancellor Angela Merkel.
Early commentary favours the new mix likely to include a party with a major pro-business platform. A far-right party surprised with the strength of its vote, sufficient for parliamentary representation, but is not expected to form part of the coalition.
Meanwhile, New Zealand’s national election has delivered no clear result, but also no curved balls.
Overseas Market Commentary
Choppy trade featured across major European and US equities markets overnight Fridayahead of the national election in Germany and as North Korea and the US talk toughened following a threat by North Korea to test another bomb, this time in the Pacific.
Post-UK Friday trade, Moody’s published a UK credit rating downgrade, significant in that the AAA ranking slipped two degrees to Aa2.
Among data releases, initial euro zone September PMIs remained robust.
In the US, Markit’s manufacturing PMI slightly exceeded forecasts, but the services estimate fell 0.9 to 55.1, pushing the preliminary composite reading down 0.7 for the month, to 54.6.
Tonight in the US, the Chicago Fed national activity index is due, together with a Texas region manufacturing index.
Elsewhere, a fourth round of official negotiations between European Union (EU) and UK representatives commences ahead of the UK’s proposed separation from the EU.
The talks, following mixed reactions to a separation speech from the UK PM overnight Friday, and Moody’s downgrade, could impact tonight’s trade sentiment.
Also in Europe, European Central Bank (ECB) president Mario Draghi speaks publicly.
The Australian market opens a new week’s trade on: scant support from overnight Fridayinternational trade; a post-trade UK credit rating downgrade; political election uncertainty in Germany and New Zealand; and heightened US-North Korea tension.
In overnight Friday commodities trade, US gold futures and WTI crude settled slightly higher. Brent crude appreciated with comparative conviction. LME copper continued lower and nickel to drop. Iron ore also extended its current slide.
The $A vacillated after trading at ~US79.55c early Friday evening.
Locally pre-trade, a weekly capital city residential property price report is due.
Regionally, Bank of Japan governor Haruhiko Karoda is scheduled to speak publicly in Osaka at 3.30pm AEST. A September preliminary manufacturing PMI is expected this morning.
Election results could influence some regional trade sentiment today, with some caution considered possible ahead of northern hemisphere market reaction to outcomes in Germany later today and tonight.
In Germany, the ruling party will need to form a different coalition from previously, but still under chancellor Angela Merkel.
Early commentary favours the new mix likely to include a party with a major pro-business platform. A far-right party surprised with the strength of its vote, sufficient for parliamentary representation, but is not expected to form part of the coalition.
Meanwhile, New Zealand’s national election has delivered no clear result, but also no curved balls.
Overseas Market Commentary
Choppy trade featured across major European and US equities markets overnight Fridayahead of the national election in Germany and as North Korea and the US talk toughened following a threat by North Korea to test another bomb, this time in the Pacific.
Post-UK Friday trade, Moody’s published a UK credit rating downgrade, significant in that the AAA ranking slipped two degrees to Aa2.
Among data releases, initial euro zone September PMIs remained robust.
In the US, Markit’s manufacturing PMI slightly exceeded forecasts, but the services estimate fell 0.9 to 55.1, pushing the preliminary composite reading down 0.7 for the month, to 54.6.
Tonight in the US, the Chicago Fed national activity index is due, together with a Texas region manufacturing index.
Elsewhere, a fourth round of official negotiations between European Union (EU) and UK representatives commences ahead of the UK’s proposed separation from the EU.
The talks, following mixed reactions to a separation speech from the UK PM overnight Friday, and Moody’s downgrade, could impact tonight’s trade sentiment.
Also in Europe, European Central Bank (ECB) president Mario Draghi speaks publicly.