The Morning Jumpstart

OVERNIGHT MARKET SNAPSHOT (as at 7am AEST)

  • SPI200 (Mar) overnight futures down 54 pts to 6243
  • SP500 down 69.53 pts to 2811.87
  • NASDAQ down 269.92 pts to 7647.02
  • Dow Jones down 617.38 pts to 25,324.99
  • FTSE100 down 39.61 pts to 7163.68
  • DAX30 down 183.18 pts to 11,876.65
  • GOLD futures US Session (June) up $13.50 to $1300.90 an ounce
  • COPPER futures US Session (Comex July) down $0.0570 to $2.7180 a pound
  • OIL futures US Session (Nymex June) down $0.82 to $60.84 a barrel
  • CRB Index down 1.31 points to 177.64
  • AUDUSD trading at 0.6942
  • EURUSD trading at 1.1223
  • GBPUSD trading at 1.2963
  • USDJPY trading at 109.2600

The US market was knocked off its perch overnight as sellers drove the action lower on heavy volume. China was the trigger for the selloff as they defied the US and announced retaliatory tariffs which led traders to flee shares for less riskier assets. The concern now for investors is whether the trade war is going to further intensify and cause a global market selloff before any potential agreement. US bond yields fell to six week lows as traders sought the safety of the dollar after a change in tone and direction for the trade talks. The DOW closed down 2.38% while the broader SP500 was down 2.41% and the Nasdaq also closed down 3.41%. In Europe, shares were also hit hard and caught up in the tariff news as traders continued the risk off tone and moved to safer asset classes.

The USD was initially down but then bounced back hard to pressure major currency crosses lower as traders sought safety in the dollar. The currency earlier fell on the fear that China may sell some of its massive Treasury Bond reserves as a negotiating tactic. The EUR gave up earlier gains to finish the session slightly lower. The AUD continued its slide that began during the Asian session as commodity indexes continued to come under pressure. The GBP fell on USD strength and on concerns that the British parliament will fail to reach a cross-party deal on Brexit . The USDJPY came under fire from a safe haven bid into the YEN.

Gold ended the session with further gains on a flight to safety even as the USD found some strength; so a good sign and small victory for gold bulls. Oil ended lower although selling pressure was capped by fears that supply may be at risk after two Saudi oil tankers were supposedly attacked near the Persian Gulf. Copper continued to come under pressure as the trade war between the US and China took a wrong turn and intensified.

Cryptocurrencies had a strong session as Bitcoin continues the march higher. Bitcoin is currently trading at $7876.1 up 9.00% while Ethereum is at $200.93 up 5.43% and Ripple is trading at $0.32504 up 3.95%.

The ASX200 had a relatively contained session in the end after opening down 30 points on trade news. The index finished yesterday down 13.3 points to 6297.6 with Financials being the biggest drag on the action. Resources, Metals and Mining and the Materials sectors held up well. Declining stocks outnumbered rising ones by 631 to 530 and 373 ended unchanged.

The ASX200 is expected to open down 55 points after the SPI200 continued to come under fire overnight as the US fell over.

ECONOMIC DATA OUT TODAY (AEST)

JPY Bank Lending and Current Account 9:50am

AUD NAB Business Confidence 11:30am

EUR German Final CPI 4pm

USD FOMC Member Williams Speaks 5:15pm

GBP Average Earnings, Unemployment Rate and Claimant Count Change 6:30pm

EUR German ZEW Economic Sentiment and Industrial Production 7pm

USD FOMC Member George Speaks 2:45am

SPI200 INTRADAY LEVELS TO WATCH