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OVERNIGHT MARKET SNAPSHOT
- SPI200 (Mar) overnight futures down 50 pts to 6133
- SP500 down 54.17 pts to 2800.71
- NASDAQ down 196.29 pts to 7642.67
- Dow Jones down 460.19 pts to 25,502.32
- FTSE100 down 147.72 pts to 7207.59
- DAX30 down 185.79 pts to 11,364.17
- GOLD futures US Session (June) up $5.10 to $1318.70 an ounce
- COPPER futures US Session (Comex May) down $0.0580 to $2.8480 a pound
- OIL futures US Session (Nymex May) down $0.94 to $59.04 a barrel
- CRB Index down 1.22 points to 184.15
- AUDUSD trading at 0.7083
- EURUSD trading at 1.1302
- GBPUSD trading at 1.3209
- USDJPY trading at 109.9200
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The US reversed the previous sessions gains and closed out the week on a very negative note. Traders exited riskier assets and entered the safety of the dollar as a weaker than expected economic data released continued to highlight a global economic slowdown. The DOW closed down 1.77% while the broader SP500 was down 1.90% and with the Nasdaq led the charge closing down 2.50%. Europe was lower from the open with major indexes closing at their session lows as fears increased for a continued global slowdown after weak manufacturing data.
Yields on government bonds have dropped both in the US and in Europe as the Fed holds off on interest rate rises for 2019. The yield on the US 10-year note sank below three month Treasury Bill yields for the first time since 2007 which inverted the yield curve. This sent traders fleeing riskier assets as yield curve inversion is seen as a leading recession indicator.
Risk aversion drove the USD higher as traders favoured the safety of the dollar over riskier assets as shares sank. The EUR was hit hard after manufacturing data released was negative and held onto the losses into the close. The GBP came under pressure after the data release but then reversed the losses to finish higher after the EU gave Prime Minister May a two-week reprieve to decide how to leave the EU. Crisis talks over the weekend may see volatility in the Pound after May met with senior colleagues and hardline Brexiteers after reports that her cabinet is plotting her downfall. The AUD continued to fall Friday night on pressure from a USD rally. The USDJPY could not hold up even on a USD rally and pushed below the 110.000 level as technical sellers were out in force and traders searched for safety in the YEN.
Gold rallied as traders sought a safe haven against the markets volatility. Oil came under pressure on the idea that demand will ease as global share markets sank. Copper had another rough session to end lower and push down through key support zones as traders go into risk off mode.
Cryptocurrencies are lower as Bitcoin struggles to hold onto gains above $4000. Bitcoin is currently trading at $3977.2 down 0.27% while Ethereum is at $135.99 down 0.59% and Ripple is trading at $0.30716 down 1.02%.
The ASX200 opened up strong Friday to trade up through 6220 but then faded into the close to end the session up only 28 points to 6195.2. The Healthcare sector led the charge higher with help from Energy and Financials while the Gold sector came under selling pressure. Rising stocks outnumbered declining ones by 675 to 469 and 360 ended unchanged.
The ASX200 is expected to open down 50 points after the US dragged the SPI200 lower on Friday night. Expect some volatility as buyers take some risk off the table and await a more certain environment.
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ECONOMIC DATA OUT TODAY (AEDT)
USD FOMC Member Evans Speaks 4pm
EUR German Ifo Business Climate 8pm
AUD RBA Assist Gov Ellis Speaks 7:30am
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SPI200 INTRADAY LEVELS TO WATCH
