To the scoreboard:
Dow: 23,422.21 -39.73 (-0.17)
S&P 500: 2,582.30 -2.32 (-0.09%)
AUD/USD: 0.7661 -0.0019 (-0.25%)
ASX200 SPI futures (December contracts, 20 minute delay): 6,031 (-1)
1. Tax uncertainty lingers: US stocks closed lower on Friday, as Senate Republicans were unable to agree with their colleagues in the House on key components of tax reform. Uncertainty about potential delays to the tax-cut legislation also weighed on the US dollar to end the week.
2. Bond market stirs: Sharp moves in the bond market are generally worth keeping an eye on, and benchmark US 10-year bond yields did just that to end the week, climbing by 7 basis points to 2.4% after drifting lower throughout November.
3. Shots fired in the bitcoin civil war: If it’s volatility you want, crypto is the place to be. Money poured out of bitcoin and into bitcoin cash over the weekend — which rocketed from around $US600 to as high as $US2,500. A short time ago, bitcoin cash had fallen to around $US1,300 as bitcoin mounted a comeback. Frank Chaparro has a good explanation here.
4. Aussie gets no love: Despite US dollar weakness, the AUD lost ground across the board in overnight markets following the RBA’s release of its quarterly outlook on Friday. Local markets will also open amid further political uncertainty as the resignation of Liberal MP John Alexander leaves the Turnbull government with a minority in the lower house.
5. The week ahead: There are two big releases from the ABS coming up — Wednesday’s quarterly wage growth data (which has been weak) followed by October employment figures on Thursday (which have been strong). Looking abroad, inflation data across global markets for October — the key mandate for most global central banks — will be released, led by the US on Wednesday night. This week’s diary can be found here.
6. Stocks have gone “completely mad”: US perma-bear John Hussman of the Hussman Investment Trust says stocks are due for a sharp correction which will set up negative returns for the next decade. Ouch.