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Market Opener – 18 Jul 2018
Local Markets Commentary
The Australian market commences mid-week trade on mostly negative commodities trade leads, but positive overnight international equities settlements, ahead of late-week influential domestic and international data releases.
In overnight commodities trade, Brent crude turned to settle modestly higher. WTI closed essentially flat.
US gold futures fell.
Iron ore (China port, 62% Fe) swung lower.
LME copper and nickel continued to decline. Aluminium swung and fell.
The $A dropped below US73.90c after trading at US74.25c early yesterday evening.
Locally today, Westpac and the Melbourne Institute publish their monthly leading index report 10.30am AEST.
Overseas Market Commentary
US equities markets generally trended higher from the outset overnight, ultimately dragging major European indices with them.
US Federal Reserve chair Jerome Powell essentially told a Senate banking committee he remained confident in the US economy, in particular with respect to employment and inflation levels, and that further, but gradual, rate rises were appropriate.
He acknowledged business concerns at the potential impacts of changing US trade relationships, however.
In the meantime, Bank of England governor Mark Carney had met with a committee of UK parliamentarians (at the Farnborough Airshow), warning of adverse economic consequences should the UK separate from the European Union (EU) without formal agreements.
Earlier, the EU and Japan announced a new trade agreement.
Among new data releases, UK wages grew 2.7% for the three months to 31 May after climbing 2.8% during the April quarter.
June new unemployment claims rose by 7800 after falling by 3000 in May.
US June US industrial production encouraged, rising 0.6% after falling 0.5% in May.
The overall figure was supported by a 0.8% gain for manufacturing output, following a 1.0% fall during May.
Year-on-year, June quarter production output came in 6.0% higher, against 2.4% for the March quarter.
A home builders’ conditions report highlighted rising input costs but sentiment remained near historical highs.
Tonight in the US, the Federal Reserve’s region-by-region economic summary is due, together with June housing starts and building permits and weekly mortgage applications.
The Federal Reserve’s chair concludes his two-day testimony in parliament, this time with a financial services committee.
Companies due to report earnings include Abbott Labs, Alcoa, American Express, ASML, BHP Billiton (this morning), eBay, EasyJet, Electrolux, IBM, Kinder Morgan, Morgan Stanley, Novartis, Premier Foods and US Bancorp.
In overnight corporate news, Goldman Sachs reported a 44% higher quarterly net profit, and confirmed a change of CEO by year’s end, but the stock settled lower.
UnitedHealth premiums appeared pale against of expectations and the stock was pushed more than 2.5% lower.
Johnson & Johnson scored a 3.5% gain after surpassing anticipated earnings.
Thyssenkrupp supported DAX trade with a 9% gain on expansion expectations.
Amazon’s ‘Prime Day’ of bargains across 36 hours (to 3am ET Wednesday) continued, but was interrupted by an early website outage. Nonetheless, the stock traded at new peaks, as did Alphabet and Facebook.
Meanwhile, Walmart secured Microsoft as its cloud provider for five years.
As anticipated, Netflix was pushed decidedly lower (~5% ultimately) following disappointing subscriber numbers reported post-Monday US trade, but notably almost halved intra-session losses.
The Australian market commences mid-week trade on mostly negative commodities trade leads, but positive overnight international equities settlements, ahead of late-week influential domestic and international data releases.
In overnight commodities trade, Brent crude turned to settle modestly higher. WTI closed essentially flat.
US gold futures fell.
Iron ore (China port, 62% Fe) swung lower.
LME copper and nickel continued to decline. Aluminium swung and fell.
The $A dropped below US73.90c after trading at US74.25c early yesterday evening.
Locally today, Westpac and the Melbourne Institute publish their monthly leading index report 10.30am AEST.
Overseas Market Commentary
US equities markets generally trended higher from the outset overnight, ultimately dragging major European indices with them.
US Federal Reserve chair Jerome Powell essentially told a Senate banking committee he remained confident in the US economy, in particular with respect to employment and inflation levels, and that further, but gradual, rate rises were appropriate.
He acknowledged business concerns at the potential impacts of changing US trade relationships, however.
In the meantime, Bank of England governor Mark Carney had met with a committee of UK parliamentarians (at the Farnborough Airshow), warning of adverse economic consequences should the UK separate from the European Union (EU) without formal agreements.
Earlier, the EU and Japan announced a new trade agreement.
Among new data releases, UK wages grew 2.7% for the three months to 31 May after climbing 2.8% during the April quarter.
June new unemployment claims rose by 7800 after falling by 3000 in May.
US June US industrial production encouraged, rising 0.6% after falling 0.5% in May.
The overall figure was supported by a 0.8% gain for manufacturing output, following a 1.0% fall during May.
Year-on-year, June quarter production output came in 6.0% higher, against 2.4% for the March quarter.
A home builders’ conditions report highlighted rising input costs but sentiment remained near historical highs.
Tonight in the US, the Federal Reserve’s region-by-region economic summary is due, together with June housing starts and building permits and weekly mortgage applications.
The Federal Reserve’s chair concludes his two-day testimony in parliament, this time with a financial services committee.
Companies due to report earnings include Abbott Labs, Alcoa, American Express, ASML, BHP Billiton (this morning), eBay, EasyJet, Electrolux, IBM, Kinder Morgan, Morgan Stanley, Novartis, Premier Foods and US Bancorp.
In overnight corporate news, Goldman Sachs reported a 44% higher quarterly net profit, and confirmed a change of CEO by year’s end, but the stock settled lower.
UnitedHealth premiums appeared pale against of expectations and the stock was pushed more than 2.5% lower.
Johnson & Johnson scored a 3.5% gain after surpassing anticipated earnings.
Thyssenkrupp supported DAX trade with a 9% gain on expansion expectations.
Amazon’s ‘Prime Day’ of bargains across 36 hours (to 3am ET Wednesday) continued, but was interrupted by an early website outage. Nonetheless, the stock traded at new peaks, as did Alphabet and Facebook.
Meanwhile, Walmart secured Microsoft as its cloud provider for five years.
As anticipated, Netflix was pushed decidedly lower (~5% ultimately) following disappointing subscriber numbers reported post-Monday US trade, but notably almost halved intra-session losses.