The Morning Jumpstart

MARKET SNAPSHOT (7:10am AEST)

  • SPI200 overnight futures up 36 pts to 6142
  • SP500 down 11.16 pts to 2762.59
  • NASDAQ down 21.44 pts to 7725.59
  • FTSE100 down 27.48 pts to 7603.85
  • DAX30 down 156.14 pts to 12677.97
  • GOLD futures down $3.10 to $1277 an ounce
  • COPPER futures down $6.65 to $306.25 a pound
  • OIL futures down $0.79 to $65.06 a barrel
  • CRB Index down 2.36 pts to 193.82
  • AUDUSD trading at 0.7380
  • EURUSD trading at 1.1589
  • GBPUSD trading at 1.3173
  • USDJPY trading at 110.0900

The US closed lower as trade war fears heat up and once again rattle markets. The DOW was down 287.26 points or 1.15% to lead the charge lower while the broader SP500 was down 0.40% and the Nasdaq down 0.28%. Trump was at it again as he threatened to impose a 10% tariff on another $200 billion of Chinese goods while China warned it would retaliate. The US woke up to the bad news but then rallied into the close to minimize the losses. US Bonds pushed higher in safe haven buying and the VIX volatility Index rallied. In Europe shares were also weaker as trade war talks took a turn for the worse and Trump is fighting on all fronts as tariffs were slapped on Canada, Mexico, the EU and now Russia.

Cryptocurrencies were mixed overnight with Bitcoin trading at $6719.8 down 0.27% while Ethereum is at $531.24 up 2.36% and Ripple is at $0.54196 up 0.88%.

The USD index pushed higher dragged along by a move up in US Bonds on safe haven buying. The EUR and the GBP were both lower on USD strength and as traders jumped into less risky assets such as the YEN and out of higher yielding FX pairs. The AUD outperformed on the selloff as commodity linked currencies suffered.

Gold fell to give up previous sessions gains as the USD rallied. Copper had another bad night down over 2% on the futures as commodities fell on trade war concerns. Oil also fell ahead of US inventories tonight which are expected to be lower.

Locally, shares yesterday had a mixed session after rallying intraday to hit resistance around 6150 and then giving up all the gains into the close. After yesterdays move lower in materials, we expect to see further pressure today as commodities again moved lower overnight. Traders may see a stronger open after the US saw a muted reaction to the trade war news but any gains may be short lived.

The ASX200 is expected to open up 30/35 points as the SPI200 rallies into the close of the US session after coming under pressure in Europe.

 

ECONOMIC DATA OUT TODAY (AEST) –

NZD  Current Account 8:45am

AUD  MI Leading Index 10:30am

EUR  German PPI 4pm

USD  Current Account 10:30pm

AUD  RBA Gov Lowe Speaks 11:30pm

EUR  ECB President Draghi Speaks 11:30pm

JPY  BOJ Gov Koroda Speaks 11:30pm

USD  Fed Chair Powell Speaks 11:30pm

USD  Existing Home Sales 12am

USD  Crude Oil Inventories 12:30am

 

SPI200 INTRADAY LEVELS TO WATCH –