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Morning Market Update: Fed Expectations Crush Market

US markets reversed earlier gains to end the overnight session deep in negative territory.

It appeared markets were on track for another positive session after the ECB surprised everyone by cutting eurozone interest rates to a new record low.

The ECB decision was followed by the latest US GDP data, which revealed the economy grew at a much faster than expected pace in the third quarter.

Notably, the GDP result was driven largely by inventory restocking, which masked underlying weakness in consumer and business spending.

Investor disappointment with the GDP numbers was compounded by fears the result could yet bring forward the start date for Fed stimulus tapering.

The Dow slumped 153 points (-1%) to 15594, the S&P500 shed 23 points (-1.3%) to 1747 and the Nasdaq tumbled 75 points (-1.9%) to 3857.

Commodities gave back some of their previous gains, with gold and oil weighed down by a resurgence in the US dollar. Gold slipped 0.7% to US$1309 an ounce and oil fell 0.6% to US$94.23 a barrel.

The ECB’s rate cut saw traders pile money into the greenback, which diminished bullion’s safe haven appeal. Oil faced added pressure from signs world leaders were making progress in easing sanctions against Iran.

The euro was another casualty of the ECB’s move to lower interest rates, whilst the Aussie dollar fell below 95 US cents as yesterday’s poor domestic jobs data increased the odds of another RBA rate cut.

In economic news, the third quarter RBA Monetary Policy Statement is due for release at 11:30am, AEDT, whilst Chinese trade data is also due out at some stage today.

 

Morning Market Update: Fed Expectations Crush Market is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Record For The Dow

Most of the major global indices strengthened overnight on hopes for a continuation of the Fed’s stimulus measures.

In the US, the Dow hit a new all-time high on the belief stimulus tapering will be pushed out further if, as expected, Friday night’s non-farm payrolls data reveals only modest job gains in October.

The Dow jumped 129 points (+0.8%) to 15747, the S&P500 climbed seven points (+0.4%) to 1770 whilst the Nasdaq slipped eight points (-0.2%) to 3932.

Across the Atlantic, most European markets closed higher after a measure of services activity in the eurozone rose more than expected in October.

Another survey showed growth in eurozone business activity slowed last month, although the slowdown was less severe than originally thought.

The UK FTSE dropped 0.1% to 6742, but the French CAC advanced 0.8% to 4287 and the German DAX rose 0.4% to 9041.

There was a strong rebound in commodity markets, with oil surging 1.6% to US$94.89 a barrel after data showed a smaller-than-expected climb in weekly US crude stockpiles.

Gold settled up 0.8% to US$1318 an ounce, buoyed a weaker US dollar.

The greenback was pressured by a Federal Reserve economic report that suggested zero interest rates in the US should be maintained for longer than expected.

The Aussie dollar recorded modest gains ahead of today’s October jobs numbers, which are expected to show a slight uptick in the nation’s unemployment rate.

The jobs data is scheduled for release at 11:30am, AEDT.

 

Morning Market Update: Record For The Dow is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Positive Start Ahead

U.S. markets regained their footing on Friday night, closing out the week with a solid gain amid positive economic data.

The ISM Purchasing Managers Index revealed manufacturing in the U.S. expanded at a faster-than-expected pace in October and the highest rate since April 2011.

The data defied expectations of a hit to growth from the recent budget drama, and spurred the Dow and S&P500 to a fourth consecutive weekly gain.

The Dow finished up 70 points (+0.5%) to 15616, the S&P500 climbed five points (+0.3%) to 1762 and the Nasdaq rose two points (+0.1%) to 3922.

There was a sea of red in commodity markets. Oil dived 1.9% to US$94.61 a barrel and tallied a whopping six percent plunge for the month of October.

The positive ISM result did little to support crude, which has been battered by surging US stockpiles and concerns over faltering energy demand.

Elsewhere, gold declined 0.8% to U$1313 an ounce, ending a nightmare week that saw it tumble close to three percent.

Bullion weakness coincided with a rebound in the greenback.

The U.S. dollar jumped 0.7% versus the euro following the week’s Fed statement, which alluded to a December start date for stimulus tapering. The shared currency faced added pressure from recent data showing weak inflation in the eurozone, stoking bets of another ECB rate cut.

In company news, Westpac has reported an 8% rise in FY13 cash profit to a record $7.1 billion, slightly beating market expectations. In a bonus for shareholders, the bank declared a special dividend of 10 cents, in addition to a final dividend of 88 cents a share.

In economic news, retail sales, the ANZ Job Ads survey and the House Price Index are all due for release at 11:30am, AEDT.

Morning Market Update: Positive Start Ahead is a post from: Australian Stock Report Market Pulse Blog

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Morning Marketing Update: Mixed Night

U.S. markets extended their declines into a second session overnight amid renewed concerns over the start date for Fed stimulus tapering.

Stocks opened lower before accelerating their losses into the close of trading after Ben Bernanke hinted stimulus tapering may occur sooner than initially thought, potentially before the end of this year.

Data also showed Chicago-area manufacturing activity surging way more than expected in October, but investors believed this more of an anomaly in light of the other less-than-impressive US economic numbers.

The Dow lost 73 points (-0.5%) to 15546, the S&P500 shed six points (-0.4%) to 1757 and the Nasdaq let go of 11 points (-0.3%) to 3920.

In Europe, data revealed a surprise contraction in German and French retail spending in September, and the eurozone jobless rate remaining stuck at a record high of 12.2%.

Still, the German and French markets defied the economic gloom, closing higher on bets the data will force the ECB to maintain its easy money policies for longer.

The DAX added 0.3%, the CAC put on 0.6%, whilst the UK’s FTSE declined 0.7%.

There were mostly declines in commodity markets, with gold nosediving on fears the Fed will scale back stimulus as soon as December, defying expectations of a 2014 start date for tapering.

Oil was also weaker, ending a horror month that saw crude tumble almost six percent. The declines were driven primarily by a surge in weekly US crude stockpiles and mixed economic data.

Gold sank 1.9% to US$1324 an ounce and oil futures backtracked 0.4% to US$96.38 a barrel. The euro was the big mover in currency markets, tumbling against the US dollar following the terrible economic numbers out of Germany and France.

In today’s economic news, the third quarter domestic Producer Price Index is slated for release at 11:30am, AEDT.

 

Morning Marketing Update: Mixed Night is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Surprise To The Upside

Global markets resumed their winning ways overnight, with the Dow and S&P500 both posting new record closing highs.

The gains came despite a mixed batch of economic data. Retail sales surprisingly contracted in September, whilst consumer confidence slumped the most in two years this month due to the recent budget drama.

However investors chose to ignore the economic results, instead betting the Fed will hold off on adjusting stimulus this week in light of the weak data.

The Dow jumped 111 points (+0.7%) to 15680, the S&P500 put on 10 points (+0.6%) to 1772 and the Nasdaq added 12 points (+0.3%) to 3952.

There was mostly red in commodity markets, with oil logging its first losing session in four as a drop in US consumer confidence fed concerns over faltering energy demand.

Gold was also weaker, weighed down by a rebound in the US dollar. The greenback was strongest against resource-linked currencies, which were hurt collectively by the fall in commodity prices.

Our dollar slid below 95 US cents after yesterday’s speech by Glenn Stevens raised hopes of another RBA rate cut. In economic news, HIA New Home Sales are due for release at some stage today.

Morning Market Update: Surprise To The Upside is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Local Action To Drive Session

It was a lacklustre start to the trading week for global markets overnight, with most major indices logging moves of less than one tenth of a percent.

It was a choppy session on Wall Street, as investors contended with a mixed set of economic numbers. Industrial production grew more than expected in September, but that was offset by a surprise slide in pending home sales during that month.

There is more important economic data to come this week, with the Fed due to meet on Wednesday night amid expectations it will hold off on tapering stimulus until 2014.

Later in the week will see the release of the October US jobs figures, which will offer clues on just how badly the recent budget fight has damaged business hiring intentions.

The Dow slipped one point to 15569, the Nasdaq shed three points (-0.1%) to 3940 and the S&P500 inched up two points (+0.1%) to 1762.

In commodity markets, oil extended its recent gains into a third session after a news report said Libya’s oil exports have slumped to just 20% of the country’s capacity.

Front month oil futures advanced 0.9% to US$98.68 a barrel.

The greenback strengthened against its major counterparts, but its gains were limited as traders brace for the Fed’s monetary policy statement later this week.

In company news, ANZ has revealed an 11% lift in FY13 cash profit, which has come in above analyst expectations. There is no major economic data due for release today.

 

Morning Market Update: Local Action To Drive Session is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Overnight Consolidation

International markets took a breather overnight, backing off from a five session rally amid disappointing earnings out of the US.

Caterpillar provided a rude awakening for investors, slashing its full year revenue and earnings forecasts amid slumping orders from mining companies.

The mining equipment giant magnified concerns that the recent market rally has stretched equity valuations to unreasonable levels.

There were modest declines on each of the three major US indices. The Dow lost 55 points (-0.4%) to 15413, the S&P500 shed nine points (-0.5%) to 1746 and the Nasdaq let go of 23 points (-0.6%) to 3907.

Most commodities suffered heavy losses, with oil diving 1.5% to US$96.86 a barrel after data showed US crude stockpiles rising more than expected for the fifth consecutive week.

Copper was another major decliner on concerns of tighter monetary policy in China, the world’s biggest consumer of the red metal. Copper futures tumbled 2.1% to US$3.27 a pound.

With markets in risk off mode, the greenback and yen rebounded against other currencies. The Aussie was among the hardest hit, as traders reacted negatively to a spike in Chinese lending rates yesterday.

Although there is no local economic data due for release today, a key regional focus will be on the HSBC China Flash Manufacturing PMI, due for release at 12:45pm, AEDT.

Morning Market Update: Overnight Consolidation is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Quite Night, Quite Morning?

Global markets had a mixed start to the new trading week amid caution ahead of a deluge of important economic data due for release this week.

There were single digit moves in the major US indices, as investors braced for tonight’s non-farm payrolls data for September. The US jobs data was delayed for almost three weeks due to the government shutdown.

There was muted reaction to a bigger than expected drop in September existing home sales, as rising prices and borrowing rates discouraged potential borrowers.

Nonetheless, the Nasdaq achieved its fourth consecutive winning session and the S&P500 made another record high.

The Nasdaq rose six points (+0.2%) to 3920, the S&P500 put on one point to 1745 whilst the Dow slipped eight points (-0.1%) to 15392.

Oil was the big focus in commodity markets, sliding below $100 a barrel for the first time since early July after data showed a bigger-than-expected rise in weekly US crude stockpiles.

The greenback recovered some of its recent losses against its major counterparts, but a weak jobs report tonight could spark another round of dollar selling as more traders price in no change to Fed stimulus until 2014.

There is no major economic data due for release today.

Morning Market Update: Quite Night, Quite Morning? is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Multi Year Highs

US markets carried their positive momentum into the overnight session, a day after US politicians agreed to raise the debt ceiling and reopen the government.

It was a record breaking night for the S&P500, which reached a new all-time high as investors breathed a sigh of relief over the US narrowly avoiding a default.

The news wasn’t as good for the Dow, which was pressured by weak quarterly results from IBM and Goldman Sachs.

The Dow slipped two points to 15372, whilst the S&P500 rose 12 points (+0.7%) to 1733 and the Nasdaq climbed 24 points (+0.6%) to 3863.

On the economic front, US jobless claims were more or less in line with estimates, whilst manufacturing activity in the Philadelphia area region grew more than expected this month.

The key theme in FX markets was across-the-board US dollar selling, with traders now expecting the Fed will hold off on stimulus tapering amid concerns over the impact of the budget fight on the US economy.

Gold was a big mover in commodity markets, surging 3.2% to US$1323 an ounce on the Fed stimulus hopes.

Elsewhere, oil slid 1.6% to US$100.76 a barrel after a supply report showed a bigger than expected jump in weekly US crude stockpiles.

The Aussie was a standout performer against its US counterpart, surging 0.9% to 96.36 US cents – its highest level since mid-June.

The local unit is likely to be influenced today by a deluge of important Chinese economic data, including GDP and industrial production, all of which are due out at 1:00pm, AEDT.

RBA Governor Glenn Stevens is also due to make an important speech at midday today.

 

Morning Market Update: Multi Year Highs is a post from: Australian Stock Report Market Pulse Blog

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Morning Market Update: Through The Ceiling

There was finally some cheer on global markets overnight after US Senate leaders announced a long-awaited compromise to raise the debt ceiling and end the government shutdown.

It was night of milestones for US markets. The Nasdaq reached a 13 year high with the S&P500 only a couple of points away from its own record high.

US stocks stayed strong despite US homebuilder confidence slipping to its lowest since June amid worries over Washington’s budget fight and rising labour costs.

The Dow soared 206 points (+1.4%) to 15374, the S&P500 climbed 24 points (+1.4%) to 1722 and the Nasdaq put on 45 points (+1.2%) to 3839.

It was risk on in commodity markets, with oil rebounding 1.1% to US$102.29 a barrel as a resolution to the US debt crisis eased concerns of a hit to energy demand.

The US dollar was broadly weaker against other currencies as the proposed budget deal reduced demand for safe haven currencies.

Our dollar built on its recent gains and recently touched its highest levels against the greenback since mid-June. The AUDUSD settled up 0.3% to 95.51 at the end of US trading.

In economic news, the NAB Quarterly Business Confidence Survey is due for release at 11:30am, AEDT.

 

Morning Market Update: Through The Ceiling is a post from: Australian Stock Report Market Pulse Blog

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