Local Markets Commentary

The Australian market opens on new news and data out of China, a ratings warning for Australia, mostly negative international equities and mixed commodities leads, and as US presidential candidates meet for a second debate.

Over the weekend, China announced several regulatory changes, including an easing of foreign investment rules while reporting a 4.5% increase in January – August foreign direct investment, to $US85.9B.

Caixin also reported a 51.8 September composite PMI for China, down 0.4 from August, and a 0.2 lower services PMI, of 52.0.

China’s markets reopen after a week-long close today, together with the expected release of September lending figures (new yuan loans).

In the meantime, Standard & Poor’s has described Australia’s foreign debt as ‘extreme’ and warned of a ratings downgrade.

In overnight Friday commodities trade, US gold futures settled slightly lower. Oil fell. Copper swung higher. Iron ore slipped a little further.

The $A approached US75.90c after trading at ~US75.70c early Friday evening. This morning, the $A briefly traded above US76.0c again.

Locally today, the RBA is scheduled to publish September foreign reserves, post-trade.

Japan’s markets will remain closed today due to a public holiday.

Overseas Market Commentary

Mainland European and US equities markets chopped overnight Friday, trading lower most of the time before settling so. The FTSE was the notable exception.

The US September employment report estimated 156,000 new jobs had been created, and that unemployment had risen 0.1% to 5.0%. Each figure missed expectations.

August consumer credit rose to $US25.9B from $US17B in July.

August wholesale inventories fell 0.2%, double the initial estimate.

In Germany, August industrial production pleased, improving 2.5% for the month, against expectations of a 0.8% rise.

It was a different story in the UK, August industrial output falling 0.4%, mainly on shutdowns in the oil sector.

Tonight in the US, no significant national economic reports are scheduled for release.

Overnight Friday, France’s TOTAL confirmed it was offloading a chemicals business, for $US3.2B, to The Carlyle Group.