To the scoreboard:
- Dow: 24,748.73 +108.49 (+0.44%)
- S&P 500: 2,682.20 +8.75 (+0.33%)
- AUD/USD: 0.7226 +0.0006 (+0.08%)
- ASX200 SPI futures (December contracts): 5,739 (+5)
1. US stocks fluctuated as markets assessed the latest US-China trade tensions, after Donald Trump said he expects to increase tariffs on Chinese imports. The Dow initially fell more than 200 points before closing higher.
2. The Aussie dollar had a volatile session overnight, but is back trading at the same level it was a day ago. The Aussie’s resilience is “reflective of recent improvements in Australia’s economy”, CBA’s Richard Grace said, along with realisation that a protracted trade war is unlikely to affect Australia’s China exports.
3. Markets kept a close eye on a speech by US Fed vice-chair Richard Clarida. Clarida said the Fed remains committed to gradual rate hikes but will be heavily data dependent in its approach to monetary policy
4. The UK pound came under pressure, falling back below $US1.28 as Prime Minister Theresa May works to get the approval of her cabinet on the draft Brexit deal, before it goes to a vote in the UK House of Commons on December 11.
5. In commodities, brent crude reversed earlier gains but managed to hold just above the $US60 a barrel mark. And after Monday’s huge falls, iron ore rebounded overnight as benchmark 62% fines rose by 1.5%.
6. Trade war wrap: A report commissioned by Koch Industries says Trump’s trade war could take a big bite out of US economic growth. And more analysts have cast doubt on any positive developments coming from this week’s G20 meeting with Trump and China’s Xi Jinping.
Today’s economic calendar:
- Q3 construction work activity from the ABS.
- Bank of England financial stability report and stress test results.
- US new home sales.
- US Fed chair Jerome Powell speaks at the Economic Club of New York.
Have a great day.