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Market Opener – 06 Aug 2018
Local Markets Commentary
The Australian market commences a new week’s trade with geopolitical tensions in focus, ahead of a week of major data releases out of China and some key domestic corporate results, and following mixed overnight international commodities trade.
Post-ASX trade Friday, China vowed to impose new tariffs on $US60B worth of US goods, including LNG.
Meanwhile, the first batch of renewed sanctions by the US against Iran comes into effect today.
The initial sanctions are against metals, vehicle and aerospace trade. Oil sanctions are set to commence in November.
In overnight Friday commodities trade, oil settled lower and US gold futures higher.
LME copper and nickel rallied.
The $A has been heading further below US74.0c this morning.
Locally today, the ANZ monthly job advertisements and Melbourne Institute/TD Securities inflation gauge reports are listed for release, ahead of the Reserve Bank of Australia’s (RBA) policy meeting tomorrow.
Pre-trade, a weekly capital city residential property price report is due
Overseas Market Commentary
Major European and US equities markets mostly headed higher from opening overnight Friday, subsequent vacillations due to investors’ considerations of trade tensions, mixed data and currency swings.
China revealed plans to place new tariffs on a further $US60B of US imports, including LNG, adding to international trade speculation, in part at new heights due to the implementation of US sanctions against some trade with Iran from today.
Among new data releases, US July employment statistics undershot some expectations, the number of jobs created estimated at 157,000, rather than the forecast 190,000.
2.7% year-on-year wages growth also failed to match predictions following the late-2017 corporate tax cuts, the rate remaining static with that calculated for June.
In the meantime, unemployment receded from 4% to 3.9%.
The ISM’s 55.7 services sector activity index, while robust, added to some of Friday’sdisappointment, falling from 59.1 in June.
The national June trade deficit meanwhile grew (7.3%) to $US46.3B from $US43.1B in May.
In the euro zone, June retail sales were reported 0.3% higher for the month, the same increase as for May.
Meanwhile, Bank of England governor Mark Carney described as ‘uncomfortably high’ the risk of the UK separating from the European Union (EU) with no firm agreement in place.
This, and a fall in the UK July services PMI from 55.1 to 53.5, pushed the British pound lower against the $US.
Tonight in the US, no major economic indicators are scheduled for release.
Companies due to report earnings or provide an update later today and tonight include: EasyJet, HSBC, Marriott International, Softbank, Subaru, Toho Zinc and Tyson Foods.
In overnight Friday and weekend corporate news, Royal Bank of Scotland announced a dividend for the first time in ~10 years. The stock was pushed 3% higher, supporting FTSE and general European financial sector sentiment.
In addition, Credit Agricole gained 2.3% (on the CAC 40) on better-than-anticipated quarterly profit.
German insurance firm Allianz bolstered the cheer with a positive full year 2018 outlook.
In other market-supportive developments, US packaging specialist Bemis appreciated 11% on reports Amcor was close to closing a deal to acquire its competitor for up to $US5B.
Saturday, Berkshire Hathaway reported an almost 70% higher, $US6.9B quarterly operating profit.
The Australian market commences a new week’s trade with geopolitical tensions in focus, ahead of a week of major data releases out of China and some key domestic corporate results, and following mixed overnight international commodities trade.
Post-ASX trade Friday, China vowed to impose new tariffs on $US60B worth of US goods, including LNG.
Meanwhile, the first batch of renewed sanctions by the US against Iran comes into effect today.
The initial sanctions are against metals, vehicle and aerospace trade. Oil sanctions are set to commence in November.
In overnight Friday commodities trade, oil settled lower and US gold futures higher.
LME copper and nickel rallied.
The $A has been heading further below US74.0c this morning.
Locally today, the ANZ monthly job advertisements and Melbourne Institute/TD Securities inflation gauge reports are listed for release, ahead of the Reserve Bank of Australia’s (RBA) policy meeting tomorrow.
Pre-trade, a weekly capital city residential property price report is due
Overseas Market Commentary
Major European and US equities markets mostly headed higher from opening overnight Friday, subsequent vacillations due to investors’ considerations of trade tensions, mixed data and currency swings.
China revealed plans to place new tariffs on a further $US60B of US imports, including LNG, adding to international trade speculation, in part at new heights due to the implementation of US sanctions against some trade with Iran from today.
Among new data releases, US July employment statistics undershot some expectations, the number of jobs created estimated at 157,000, rather than the forecast 190,000.
2.7% year-on-year wages growth also failed to match predictions following the late-2017 corporate tax cuts, the rate remaining static with that calculated for June.
In the meantime, unemployment receded from 4% to 3.9%.
The ISM’s 55.7 services sector activity index, while robust, added to some of Friday’sdisappointment, falling from 59.1 in June.
The national June trade deficit meanwhile grew (7.3%) to $US46.3B from $US43.1B in May.
In the euro zone, June retail sales were reported 0.3% higher for the month, the same increase as for May.
Meanwhile, Bank of England governor Mark Carney described as ‘uncomfortably high’ the risk of the UK separating from the European Union (EU) with no firm agreement in place.
This, and a fall in the UK July services PMI from 55.1 to 53.5, pushed the British pound lower against the $US.
Tonight in the US, no major economic indicators are scheduled for release.
Companies due to report earnings or provide an update later today and tonight include: EasyJet, HSBC, Marriott International, Softbank, Subaru, Toho Zinc and Tyson Foods.
In overnight Friday and weekend corporate news, Royal Bank of Scotland announced a dividend for the first time in ~10 years. The stock was pushed 3% higher, supporting FTSE and general European financial sector sentiment.
In addition, Credit Agricole gained 2.3% (on the CAC 40) on better-than-anticipated quarterly profit.
German insurance firm Allianz bolstered the cheer with a positive full year 2018 outlook.
In other market-supportive developments, US packaging specialist Bemis appreciated 11% on reports Amcor was close to closing a deal to acquire its competitor for up to $US5B.
Saturday, Berkshire Hathaway reported an almost 70% higher, $US6.9B quarterly operating profit.