To the scoreboard:
- Dow: 25,339.24 -27.19 (-0.11%)
- S&P 500: 2,738.12 -5.66 (-0.21%)
- AUD/USD: 0.7317 +0.0011 (+0.15%)
- ASX200 SPI futures (December contracts): 5,752 (+6)
1. The S&P500 was up for most of the day but drifted lower into the close, as global markets largely consolidated the previous day’s move in the wake of Fed chair Jerome Powell’s speech, which was interpreted as more dovish.
2. PCE data in the US showed consumer spending growth hit a seven-month high, but underlying inflation missed forecasts with a print of just 1.8%. US 10-year bond yields briefly fell below 3% whiile 2-years edged higher, leaving the 2-10 yield spread back at 22 basis points.
3. The minutes from the US Fed’s November meeting “supported the idea of a December rate hike, then an open debate” for 2019, Westpac’s Sean Callow said. Committee members indicated that decisions on further hikes next year will be more data dependent.
4. Oil had a volatile session, as brent crude briefly fell as low as $US57.50 a barrel, before rising sharply back towards $US60 following reports that Russia may consider joining Saudi Arabia in cutting supply.
5. Attention will turn to the G20 summit this weekend in Argentina, with Donald Trump scheduled to meet with China’s Xi Jinping on Saturday night. Prime Minister Scott Morrison flew to Buenos Aires last night, and said trade war fears “pose real threats to the global economy”.
6. And it’s been a rough couple of months for shareholders in the big US tech companies. But HSBC think the selloff has been overdone and it’s time to buy the dip. To back their view, the analysts listed seven misconceptions about FAANG stocks.
Today’s economic calendar:
- Australian private sector credit for October (11:30am AEDT).
- China business survey and manufacturing PMIs (official government data).
- India Q3 GDP.
- Bank of Korea interest rates announcement.
- Eurozone core inflation (November) and unemployment rate (October)
- US Fed’s Williams gives a speech on the global economy in New York.
Have a great weekend.