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OVERNIGHT MARKET SNAPSHOT (as at 7am AEST)
- SPI200 (Sep) overnight futures up 36 pts to 6632
- SP500 up 3.68 pts to 2979.63
- NASDAQ up 43.35 pts to 8141.73
- Dow Jones down 22.35 pts to 26,783.49
- FTSE100 down 12.80 pts to 7536.47
- DAX30 down 106.96 pts to 12,436.55
- GOLD futures US Session (August) down $0.40 to $1399.60 an ounce
- COPPER futures US Session (Comex Sept) down $0.0310 to $2.6280 a pound
- OIL futures US Session (Nymex Aug) up $0.68 to $58.34 a barrel
- CRB Index up 0.02 pts to 180.71
- AUDUSD trading at 0.6928
- EURUSD trading at 1.1207
- GBPUSD trading at 1.2462
- USDJPY trading at 108.8600
- USD Index (ICE Sept) at 97.093 up 0.109
US Indexes were mixed overnight as trade tensions weighed on the outlook for corporate earnings and hopes dwindled for a hefty US rate cut. With Powell set to testify to Congress tonight, expectations are for a 25 basis point cut at the end of the month while the more aggressive 50 points has been factored back out of the bond market. Trade tensions will be in focus as Earnings season kicks off next week. 3M was downgraded overnight which pressured markets and lowered expectations for earnings. The DOW closed down 0.08% while the broader SP500 was up 0.12% and the Nasdaq also ended up 0.54%. In Europe, major Indexes were dragged lower on a profit warning from chemicals giant BASF who cited trade friction for the uncertainty. A drop in Copper prices also pressured miners.
Buyers stepped in to support markets after news came out that the US and China were set to relaunch trade talks. Although it is yet to be seen if talks will progress towards a resolution on trade and tariffs as we have been down this road many times before, the news does give traders some hope to focus on.
The USD Index moved higher again overnight as traders continued to reposition themselves ahead of Powells testimony to Congress. Even though the outlook for two rate cuts has eased, weaker jobs data overnight which showed a sharp dropoff in hiring could keep the pressure on the Fed. The Euro moved lower on the rise in the Dollar while the GBP continued to come under selling pressure and move to a six month low on the back of rising fears fears for a no-deal Brexit as the countries leadership remains in limbo. The AUD came under selling pressure from the open yesterday to drop 40 pips as trade tensions and rate cuts continued to pressure the pair. The USDJPY was well contained overnight finding sellers above 108.900 and buyers down towards 108.700.
Gold saw a relatively flat close after bulls managed to defend an early selloff into support. Price moved down to test recent lows around 1386 but buyers stepped in to soak up the pressure and push price back up into the US close. We will be watching for bulls to build a higher low which could lead to a squeeze on recent sellers. Oil ended higher as price spiked into the US close ahead of US inventory data out tonight. OPEC supply cuts and Middle East tensions outweighed US/China trade disputes as buyers continued to support pullbacks into the commodity. Copper was sold lower at the start of European trade and price could not recover. Trade tensions continue to pressure the commodity as traders expect continued weak demand from China.
Cryptocurrencies were mixed with Bitcoin edging higher as it is currently trading at $12622.3 up 2.67%. Ethereum is trading at $308.32 down 0.78% while Ripple is trading at $0.39434 down 0.83%.
The ASX200 spent all of the session in the red yesterday and in the end finished down 6.5 points to 6665.7. It was a mixed session with the Information Tech sector winning the race lower while the Consumer staples sector was the biggest shining light. Falling stocks outnumbered advancing ones by 639 to 538 and 363 ended unchanged.
The ASX200 is expected to open up 35 points as the SPI200 found buyers coming out to play overnight.
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ECONOMIC DATA OUT TODAY (AEST)
AUD Westpac Consumer Sentiment 10:30am
CNY CPI and PPI Data 11:30am
GBP GDP, Manufacturing Production and Industrial Production 6:30pm
CAD BOC Rate Statement and Monetary Policy Report 12am
USD Fed Chair Powell Testifies and Wholesale Inventories 12am
USD Crude Oil Inventories 12:30am
USD FOMC Meeting Minutes 4am
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SPI200 INTRADAY LEVELS TO WATCH
