The Morning Jumpstart


  • SPI200 (Dec) overnight futures up 6 pts to 6676
  • SP500 up 9.88 pts to 3046.77
  • NASDAQ up 27.13 pts to 8303.98
  • Dow Jones up 115.27 pts to 27,186.69
  • FTSE100 up 24.52 pts to 7330.78
  • DAX30 down 29.39 pts to 12,910.23
  • GOLD futures US Session (December) up $6.60 to $1497.30 an ounce
  • COPPER futures US Session (Comex Dec) down $0.013 to $2.6790 a pound
  • OIL futures US Session (Nymex Dec) down $0.65 to $54.89 a barrel
  • CRB Index down 0.06 pts to 178.31
  • AUDUSD trading at 0.6899
  • EURUSD trading at 1.1148
  • GBPUSD trading at 1.2902
  • USDJPY trading at 108.8700
  • USD Index US Session (ICE Dec) down 0.209 to 97.260

US Stock Indexes were testing lows early in the session but then lifted late as the US Fed Reserve cut interest rates for a third time this year as widely expected. Shares spiked on the news of ‘easier money’ into the close to end the session with healthy gains. The Fed cut rates in a move to help sustain growth but did signal a pause in the trade related rate cuts unless ‘the economy takes a turn for the worse’. Fed Chair Powell noted that the outlook for the US economy continues to be for “moderate” growth as the US/China trade war is a step closer to resolution and its looking less likely that Britain will crash out of the EU. The DOW closed up 0.43% while the broader SP500 was up 0.33% and the Nasdaq also ended up 0.33%. In Europe, Indexes focused on earnings in a quiet session ahead of the US Fed rate release. Mixed earnings from some of Europe’s biggest companies kept a lid on gains going into the US session.

The US Fed is at an unusual point in the economic cycle as Unemployment is at all time lows, inflation is moderate and recent data (GDP growth data out overnight eased from 2.0% to 1.9%) is signally easing. These factors are usually accompanied by higher interest rates, after an expansionary period, going into a rate cutting cycle. If the US was suddenly having to deal with increasing unemployment, there is not a lot of bullets left in the barrel to support the economy. The hopes are that the ‘pre-emptive’ rate cuts are enough to stabilize the economy and keep inflation at the lower end of the Feds target range and growth on track.

The USD initially spiked hard on rate cuts but then fell away to end lower for the session. Pressuring the Dollar was the exit from perceived safety as US Bond yields fell and the Yield curve again flattened. The EURO was lifted by the pressure into the USD with price currently pushing up to previous highs around 1.1180. The GBP also lifted on the back of USD weakness but sellers capped the action around 1.2905. The AUD spiked hard straight through the 0.6890 resistance zone. Price is extended so it will be interesting to see if price action can continue to extend further. The USDJPY initially spiked to flush out recent sellers but then fell away as the YEN rallied and dollar lost ground.

Gold lifted on the dollar weakness to make back the lost ground from an initial flush lower to clear out some buyers. We are now watching to see if safe haven buying is dragged back into the precious metal on a flattening of the yield curve and a resurgence of recession concerns. Crude Oil continued to come under pressure but was saved from a weak close as the dollar fell. Prices are under pressure on concerns for a possible delay to a US/China trade war deal and therefore continued weaker global demand for the commodity. Copper also moved lower being weighed down by trade war delays as price could not recover all of the losses from an initial spike lower on interest rate cut news.

Cryptocurrencies eased back a little but continue to look shorter term bullish. Bitcoin is currently trading at $9188.7 down 0.51% while Ethereum is at $183.25 down 2.40% and Ripple is trading at $0.29548 down 1.09%.

The ASX200 had a rough session as buyers unwound positions into the market. The index opened around 20 points weaker yesterday and then continued to sell lower into the close to end down 55.9 points to 6689.5. All sectors ended the session in the red with Telecom Services, IT and Consumer Staples leading the charge lower. Inflationary CPI data came out in line with expectations which triggered a spike into the AUDUSD. Falling stocks outnumbered advancing ones by 685 to 467 and 357 ended unchanged.

The ASX200 is expected to open up 5 points as the SPI200 found support overnight. Traders will be watching Aussie Building Approvals and Chinese Manufacturing data out today.


JPY Prelim Industrial Production 10:50am

NZD Business Confidence 11am

AUD Building Approvals 11:30am

CNY Manufacturing PMI 12pm

JPY BOJ Outlook Report, Policy Rate and Monetary Policy Statement Tentative

EUR German Retail Sales 6pm

EUR CPI Flash Estimate and Unemployment Rate 9pm

CAD GDP 11:30pm

USD Personal Spending and Personal Income 11:30pm