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Market Opener – 13 Mar 2019

 
Local Markets Commentary
The Australian market opens mid-week trade on mixed overnight international equities and largely positive commodities price leads, with the UK parliament set to decide tonight whether to leave the European Union without a deal or to delay the planned 29 March withdrawal. 

Locally today, a monthly consumer confidence report from Westpac and the Melbourne Institute is due 10.30am AEDT.

Stocks trading ex-dividend include: CSL, ING, NST and REG. Please see pp3-4 for a comprehensive list.

In overnight commodities trade, oil added slightly to Monday’s gains.

US gold futures (April) seesawed again, settling moderately higher.

Iron ore (China port, 62% Fe) swung higher.

LME copper picked up the pace of Monday’s rise. Nickel and aluminium each swung higher and rallied.

The $A appreciated to ~US70.80c after trading above US70.70c early yesterday evening.

Overseas Market Commentary
Choppy trade proved the only common feature across major European and US equities markets overnight. 

The UK parliament’s House of Commons voted post-FTSE trade to reject (391 – 242) the latest plans for the UK’s withdrawal from the European Union (EU).

Tonight, the house will vote on whether to retain the 29 March separation date and withdraw without any deal in place.

Pending tonight’s outcome, further votes are anticipated from Thursday, covering options from delaying separation plan to, hosting another referendum. The PM’s leadership is also under question, and in association, a possible early national election.

In the meantime, several key UK economic indicators were updated, the January trade deficit rising to £3.825B from £3.448B 

January GDP growth came in at 0.5% for the month and 1.4% year-on-year, following a 0.4% December monthly fall. 

December quarter construction orders dropped 10.5% year-on-year following a 31.4% September quarter slide.

January construction output rose 1.8% year-on-year however, against a 0.7% December fall.

Industrial production rose 0.6% during January but represented a 0.9% decline compared with January 2018.

During December, industrial output had fallen 0.5%.

In the US, February inflation growth was estimated at 0.2% for the month and 1.5% year-on-year. The annual rate represented the slowest growth pace in ~2.5 years.

During January, prices had remained flat. 

A small business optimism index rose by 0.5 to 101.7.

Meanwhile, China’s VP and key trade negotiator with the US Liu He confirmed he had spoken with the US treasury secretary Steven Mnuchin and also US head trade negotiator Robert Lighthizer by telephone yesterday.

Mr Lighthizer confirmed to a senate committee that significant issues were yet to be sorted but that his view was that the US and China were just weeks away from a deal.

Tonight in the US, January durable goods orders and construction spending are due, together with weekly mortgage applications.

Elsewhere, the UK chancellor delivers a new annual budget and Spring forecasts ahead of a House of Commons vote on whether to separate from the EU without firm arrangements.

Companies scheduled to report earnings include: adidas, Balfour Beatty, E.ON, UK supermarket chain Morrisons, Prudential and Williams-Sonoma.

In overnight corporate news, a further Boeing fall adversely impacted DJIA trade. 

In addition, specialist retailer Dick’s Sporting Goods lost more than 10% on disappointing sales.
 
Posted on 13/03/2019 7:00:00 AM

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