The Morning Jumpstart

OVERNIGHT MARKET SNAPSHOT (as at 8:30am AEDT)

  • SPI200 (Dec) overnight futures down 10 pts to 6707
  • SP500 down 11.72 pts to 3108.46
  • NASDAQ up 43.92 pts to 8526.73
  • Dow Jones down 112.93 pts to 27,821.09
  • FTSE100 down 61.31 pts to 7262.49
  • DAX30 down 62.98 pts to 13,158.14
  • GOLD futures US Session (December) down $2.50 to $1471.80 an ounce
  • COPPER futures US Session (Comex Mar) down $0.009 to $2.6470 a pound
  • OIL futures US Session (Nymex Dec) up $1.90 to $57.11 a barrel
  • CRB Index up 1.81 pts to 178.96
  • AUDUSD trading at 0.6801
  • EURUSD trading at 1.1072
  • GBPUSD trading at 1.2922
  • USDJPY trading at 108.6200
  • USD Index US Session (ICE Dec) up 0.058 to 97.800

US Stock Indexes came under further pressure to extend their losses as expectations grew that a trade deal will not be done this year. China is pressing for more extensive tariff rollbacks while the Trump administration counters with heightened demands of its own. It seems that a deal is more elusive now than when a phase 1 deal was anounced five weeks ago as the context of the deal becomes more complicated. Rolling back tariffs for a deal that fails to address core intellectual property and technology transfer issues will not be seen as a good deal for the US and Trump recently stated that he will only accept a deal that is good for the economy….in what now seems was a hint at the delays that were to come. Further tariffs are set to come into affect on Dec 15th so we will see how talks/news progress over the coming weeks. The DOW closed down another 0.40% while the broader SP500 was down 0.38% and the Nasdaq ended down 0.51%. In Europe, Indexes logged their worst day in three weeks on increased concern over trade. Hong Kong could prove to be a major stumbling block for a deal in coming weeks if China see any move from the US as meddling in national affairs.

Hong Kong is slowly becoming more of an issue as the violent crackdown against protesters continues. Conflicts within the White House on how to tackle the issue have increased although the US Senate passed a bill Tuesday night condemning the crackdown and pledging support for Hong Kong which was immediately criticized by Beijing.

The USD had another choppy session as price rallied into the open of the US session only to give up the gains and end the session relatively flat as US bond yields fell on trade concern. The EURO was on the way lower through the European session but clawed back the losses to end roughly where it finished the prior session. The GBP also saw some choppy action thanks to the swings in the USD. The action continued to move lower off key resistance but managed to bounce during the US session and looks set to run higher as buyers support a minor higher level around 1.2905. The AUD did not have much of a chance once the trade news filtered through the market as sellers piled into the action to continue the move lower. If price pushes down through the 0.6785 zone then expect a move below 0.6770 lows. The USDJPY also found some choppy action from traders as bulls and bears fought it out. Buyers managed to put in a minor higher low so we may see price attack recent highs if buyers can push up through 108.650.

Gold managed to push up off lows into the close of US trade although did not find the safe haven bid as expected on the trade news. Crude Oil rallied hard off session lows even as crude oil inventories came out up and in line with expectations. Buyers managed to gain back a lot of lost ground from the previous sessions move down. Price remains choppy as selling pressure due to trade concern is met with buyers on expectations that OPEC will cut production further. Copper rallied from the open of the Euopean session only to give up the gains and a little more as the trade news hit and concern grew that a deal will not be done this year.

Cryptocurrencies again came under pressure to give up earlier gains and end down on their lows for the session. Bitcoin is currently trading at $8100.8 down 0.25% while Ethereum is at $174.70 up 0.01% and Ripple is at $0.24900 down 0.21%.

The ASX200 had a rough session for the bulls yesterday as sellers piled in from the open and did not let up until the close. The Index opened weaker as expected but the pressure continued until the close which was down 91.8 points to 6722.4. The biggest drag on the Index was the Financial sector followed by Utilities and Energy. Falling stocks outnumbered advancing ones by 681 to 466 and 323 ended unchanged.

The ASX200 is expected to open down 10 points as the SPI200 continued to come under pressure in the overnight session which is expected to flow over into the ASX action today.

ECONOMIC DATA OUT TODAY (AEDT)

GBP Public Sector Net Borrowing 8:30pm

EUR ECB Monetary Policy Meeting Accounts 11:30pm

USD Philly Fed Manufacturing Index and Unemployment Claims 12:30am

CAD BOC Gov Poloz Speaks 12:40am

EUR Consumer Confidence 2am

USD Existing Home Sales 2am

SPI200 INTRADAY LEVELS TO WATCH