The Morning Jumpstart

OVERNIGHT MARKET SNAPSHOT (7:15am AEDT)-

  • SPI200 (Sep) overnight futures down 109 pts to 5914
  • SP500 down 91.87 pts to 2788.47
  • NASDAQ down 315.96 pts to 7422.05
  • FTSE100 down 91.85 pts to 7145.74
  • DAX30 down 264.72 pts to 11712.50
  • GOLD futures (Dec) up $5.50 to $1197 an ounce
  • COPPER futures (Comex Dec) down $0.054 to $2.752 a pound
  • OIL futures (Nymex Nov) down $2.13 to $72.83 a barrel
  • CRB Index down 2.26 pts at 198.12
  • AUDUSD trading at 0.7073
  • EURUSD trading at 1.1521
  • GBPUSD trading at 1.3188
  • USDJPY trading at 112.3500

 

The US was hammered overnight as traders finally made some decisions and ran for cover into safe haven assets. US Bond Yields were again higher making them more attractive than shares for yield as the US looks to raise interest rates further. Higher PPI data out in the US stoked the flames for higher inflation and confirm the Feds interest rate outlook. Tech stocks on the Nasdaq led the charge lower on signs of slowing demand in the semiconductor industry. The DOW closed down a massive 831.83 pts or 3.15% while the broader SP500 was down 3.29% and the Nasdaq closed down 4.08%.  In Europe rising bond yields also caused havoc in shares as traders exited riskier assets for the safety of bonds.

The USD was slightly lower even as Bond yields continued to gain as traders chased returns. The GBP and the EUR were higher on positive Brexit talk hinting at progress and increased optimism for a deal while emerging market issues took a back seat. The AUD was lower as commodity indexes surged lower.

Gold buyers again lifted the price of gold which also found support from the weaker USD. Gold bugs tend to flow into the precious metal in times of Equity stress although smart money is looking to Bonds and the USD for future profits. Copper fell to give up some recent gains as concern for US/China trade relations persist. Oil was also caught up in the selloff as buyers locked in profits and price fell over 3%.

Cryptocurrencies were lower overnight but held up okay as global equities sunk. Bitcoin is currently trading at $6625.1 down 0.22% with Ethereum at $226.33 down 0.89% and Ripple trading at $0.46801 down 2.50%.

Locally, the ASX200 ended the session up 8.7 points to buck the trend of the previous few days although it will be a different story today. Traders will be watching the key 6000 weekly support zone to potentially come under fire today as confidence is still low. Asian shares were flat yesterday which gave some relief as investors stayed on the sidelines. Declining stocks outnumbered rising ones by 625 to 496 and 367 ended unchanged.

The ASX200 is expected to open down over 100 points as the SPI200 was hammered along with US indexes overnight. Prudent trading today would be to watch the action unfold and not chase bargains.

 

ECONOMIC DATA OUT TODAY (AEST) –

USD  FOMC Member Bostic Speaks 9am

AUD  RBA Assist Gov Ellis Speaks 9:30am

JPY  Bank Lending and PPI Data 10:50am

AUD  MI Inflation Expectations 11am

Day 1  G20 Meetings

GBP  BOE Gov Carney Speaks 4pm and 8Pm

EUR  ECB Monetary Policy Meeting Accounts 10:30pm

USD  CPI Data and Unemployment Claims 11:30pm

USD  Crude Oil Inventories 2am

 

SPI200 INTRADAY LEVELS TO WATCH –