March 20, 2019
OVERNIGHT MARKET SNAPSHOT (7:15am AEDT)
The US closed little changed overnight as trade concerns offset optimism over the Fed expected dovish stance on rates. New orders for US made goods rose less than expected and shipments of factory goods fell for a fourth straight month. Manufacturing accounts for around 12% of the economy and is slowing as stimulus from tax cuts fade and are being hampered by a trade war. The DOW closed down 0.10% while the broader SP500 was down only 0.01% while the Nasdaq also closed up 0.12%. Europe had a good session and major Indexes rallied on the back of a good performance from automakers on merger talk.
The USD had a relatively uneventful session with price edging lower as the Fed Reserve kicks off its two day policy meeting. We still see a mixed outlook for the USD as pressure will come from a slowing economy although the flow of money into the dollar as traders look for the positive interest rate yield should be supportive for price. The EUR and the GBP managed a small rally against the USD as the GBP was supported by better than expected employment data, while the AUD came under pressure through both the European and US sessions to close down on its lows. May continued to try to salvage her Brexit deal overnight as she is expected to ask the EU for an extension for the March 29 deadline. The USDJPY closed the session relatively unchanged as traders await FOMC news.
Gold started the US session on a high above $1311 but was then sold lower into the US close to finish with modest gains. Oil gave up some of its recent gains to end lower while Copper edged higher as Trump said that trade talks are going ‘very well’.
Cryptocurrencies lifted overnight as Bitcoin traded above $4000 and is currently at $4006.4 up 0.69%. Ethereum is currently trading at $138.36 up 0.54% and Ripple is at $0.31492 up 0.44%.
The ASX200 had another very choppy session yesterday to oscillate between gains and losses all day. In the end the Index finished down 5.7 points to 6184.8 as it struggles to follow the US higher. The Healthcare sector weighed on the index while the Metals and Mining and Gold sectors did their best to minimize the losses. Iron Ore prices continued to kick higher and lifted the commodity’s miners. The RBA confirmed its commitment to a neutral policy stance which eased fears for a rate cut for now but they also expressed fears for the housing market. Falling stocks outnumbered advancing ones by 589 to 538 and 361 ended unchanged.
The ASX200 is expected to open up 5/10 points as the SPI200 may continue to remain choppy ahead of the Futures contract rollover tomorrow.
ECONOMIC DATA OUT TODAY (AEDT)
AUD MI Leading Index 10:30am
JPY Monetary Policy Meeting Minutes 10:50am
AUD RBA Assist Gov Bullock Speaks 11am
EUR German PPI 6pm
GBP CPI and PPI Data 8:30pm
USD Crude Oil Inventories 1:30am
USD FOMC Statement, Fed Funds Rate and Economic Projections 5am
USD FOMC Press Conference 5:30am
SPI200 INTRADAY LEVELS TO WATCH
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