The Morning Jumpstart


  • SPI200 (Dec) overnight futures down 75 pts to 6653
  • SP500 down 36.49 pts to 2940.25
  • NASDAQ down 90.65 pts to 7908.68
  • Dow Jones down 343.79 pts to 26,573.04
  • FTSE100 down 47.89 pts to 7360.32
  • DAX30 down 164.25 pts to 12,263.83
  • GOLD futures US Session (December) up $12.30 to $1485.20 an ounce
  • COPPER futures US Session (Comex Dec) down $0.0150 to $2.5640 a pound
  • OIL futures US Session (Nymex Nov) down $0.09 to $53.98 a barrel
  • CRB Index up 0.15 pts to 174.09
  • AUDUSD trading at 0.6704
  • EURUSD trading at 1.0931
  • GBPUSD trading at 1.2303
  • USDJPY trading at 107.7400
  • USD Index US Session (ICE Dec) trading at 98.800 down 0.221

US Indexes continued to rinse traders out of the market as shares were hit hard and fell over into the close. Weaker than expected manufacturing data showed that the US manufacturing sector contracted in September to its weakest level in more than a decade as business conditions worsened on the back of continuing trade wars. The data therefore increased expectations that the Fed will cut rates as Trump again hit out on Twitter, saying they ‘don’t have a clue’ and calling them ‘pathetic’, blaming the Fed and higher interest rates for the weakness in manufacturing. The DOW closed down 1.28% while the broader SP500 was down 1.23% and the Nasdaq ended down 1.13%. In Europe, Indexes were hit late in the session as the US opened and headed south after the data release. The US data came hot on the heals of euro zone data that showed manufacturing activity contracting at its steepest rate in almost seven years. The DAX index came under fire as the US opened while the FTSE managed to hold up as the weaker Pound provided some support.

The USD is caught up in a global central bank rate war as price remains relatively strong in the face of a potentially weak outlook. The problem for the USD is that the divide between US rates and those in Europe and Japan still remains wide so buyers continue to step into the dollar for the interest rate differential and the safety of the dollar. Unless the expectations are for the US Fed Reserve to start an ‘easing cycle’ and play catch up, the dollar will continue to be buoyed by buyers and other major currencies pushed lower. The problem now for Trump is that the Fed may not give him what he desperately wants – rate cuts – as the economy is growing around 2% on a quarterly basis while the rest of the world struggles and a number of Fed officials have already voiced support for ‘holding’ unless the incoming data grows increasingly worse.

The USD took at hit after the data release as traders look to a potential rate cut from the Fed in the next FOMC meeting. The EURO rallied off the lows directly after the US data release as the USD fell over. The GBP was well and truly under pressure coming into the US stock market open so the fall in the USD was a welcome relief for buyers of the Pound as price retraced its losses. The AUD continued the move lower through the European session which started after the RBA cut rates and mentioned that they are ready to cut further if need be. The rally in the USD triggered sellers to exit short positions and lock away some of the gains. The USDJPY was hit hard and fell apart on the release and looks set to push to lower levels. The move was exaggerated by a lift in safe haven YEN buying.

Gold reacted to the weaker USD with a rally as buyers jumped back in to the action looking for a bargain. Oil came under pressure as the USD fell although made back a lot of the losses into the US close as buyers stepped in around major lows. Copper was not excluded from the USD move as sellers piled in to push the metal lower. It looks like it was an intraday move and sellers were not long term as they closed shorts and the price bounced into the close.

Cryptocurrencies held up well as the US equity market came under fire with Bitcoin currently trading at $8370.4 up 1.82%. Ethereum is trading at $177.38 up 0.48% and Ripple is lower trading at $0.24987 down 1.27%.

The ASX200 continued to see some choppy action yesterday as buyers decided to ramp price higher yesterday after the RBA announced an interest rate cut of 0.25 from 1.0% to 0.75%. Even though the move from the RBA was expected, they said that they are prepared to cut rates further so buyers came out in force and pushed the Index to end up 54.5 points to 6742.8. The Healthcare sector was the biggest gainer being followed by Industrials and Telcom Services. Rising stocks outnumbered declining ones by 624 to 528 and 359 ended unchanged.

The ASX200 is expected to open down 70/75 points after the US was hit hard overnight into the close.


CNY Bank Holiday All Day

JPY Consumer Confidence 3pm

USD ADP Non-Farm Employment Change 10:15pm

USD Crude Oil Inventories 12:30am

USD FOMC Member Williams Speaks 12:50am