The Morning Jumpstart

OVERNIGHT MARKET SNAPSHOT (as at 7am AEST)

  • SPI200 (Dec) overnight futures down 72 pts to 6663
  • SP500 down 25.18 pts to 2966.60
  • NASDAQ down 118.83 pts to 7993.63
  • Dow Jones down 142.22 pts to 26,807.77
  • FTSE100 down 34.65 pts to 7291.43
  • DAX30 down 35.18 pts to 12,307.15
  • GOLD futures US Session (December) up $7.70 to $1539.20 an ounce
  • COPPER futures US Session (Comex Dec) down $0.0090 to $2.6030 a pound
  • OIL futures US Session (Nymex Nov) down $1.84 to $56.80 a barrel
  • CRB Index down 1.47 pts to 177.19
  • AUDUSD trading at 0.6801
  • EURUSD trading at 1.1017
  • GBPUSD trading at 1.2491
  • USDJPY trading at 107.0500
  • USD Index (ICE Sept) trading at 97.938 up 0.283

US Indexes fell from the open and never looked back as prices closed on their lows as a push for impeachment of Trump gained momentum. Also pressuring the markets lower was weaker than expected consumer confidence data which highlighted concerns over the ongoing trade war and the impacts on the economy and the labour market. The worries centered around a potential slow down in consumer spending which has been the main driver of the US economy. The DOW closed down 0.53% while the broader SP500 was down 0.84% and the Nasdaq ended down 1.46%. In Europe, Indexes came under pressure from the open and again as the US consumer confidence data was released. Markets continued to grapple with recent dismal German manufacturing data which kept traders on the back foot as they try to decipher what it all means for the EU economy going forward.

Concerns now for traders is again a potential recession as many still see the longest economic expansion on record, which is now in its eleventh year, may come to an end soon. The expansion is mainly being supported by consumer spending thanks to the lowest unemployment rate in close to 50 years. What the consumer confidence data showed is that consumers are clearly worried and may slam the brakes on spending at any time.

The USD moved lower being pressured by weaker consumer confidence data and talk of Trump impeachment. Traders will also be looking to the possibility that the US Fed may be forced to cut rates again in the coming FOMC meeting if share markets come under continued pressure. The EURO found some support, to squeeze out recent sellers, from the weaker USD and from data showing German business confidence rose for the first time in six months which comes on the back of rough manufacturing data the previous session. The GBP gained ground after the UK Supreme Court ruled that Prime Minister Boris Johnson’s decision to suspend parliament for five weeks was unlawful. The news gave traders confidence that Britain would not leave the EU without a deal in place. The AUD got a boost from the weakness in the USD but gains were also capped by continued trade war concerns. The USDJPY continued the move lower as safe haven YEN buyers dived into the action and cancelled out any pressure from the falling dollar.

Gold continued its move higher as traders remained drawn to the safety of the precious metal. Gold also was boosted by the fall in the USD as we see the potential for the commodity to trade up to the highs around $1565 in the near term. Oil again came under pressure as concerns for a global recession came back on the table which would mean a fall in demand for the commodity. Copper also found sellers pushing price lower against the flow of the USD.

Cryptocurrencies had a rough session as prices across the board were hit hard. Bitcoin is currently trading at $8532.2 down 14.65% while Ethereum is at $165.04 down 24.47% and Ripple is trading at $0.23511 down 18.63%.

The ASX200 had a choppy session yesterday as price opened higher and sold off then moved between minor gains and losses throughout the remainder of the session. In the end the Index finished relatively flat down only 0.8 points to 6748.9. The biggest drag on the market was the IT sector while Gold managed to balance the index out as it ended up over 1.6%. Falling stocks outnumbered advancing ones by 589 to 551 and 386 ended unchanged.

The ASX200 is expected to open down 70 points after the SPI200 fell off a cliff overnight following Europe and the US lower.

ECONOMIC DATA OUT TODAY (AEST)

NZD Trade Balance 8:45am

JPY Monetary Policy Meeting Minutes 9:50am

NZD RBNZ Official Cash Rate and Rate Statement 12pm

EUR German Consumer Climate 4pm

GBP High Street Lending 6:30pm

USD FOMC Member Evans Speaks 10pm

USD FOMC Member George Speaks 12am

USD Crude Oil Inventories 12:30am

SPI200 INTRADAY LEVELS TO WATCH