Your morning market update after a very interesting night.
– The Aussie rallied on RBA governor Glenn Stevens’ comments, Gold fell below $1300 oz at one stage and US stocks lost ground again, showing signs of being affected by altitude sickness at all-time highs on the S&P 500.
– Key to the afternoon sell-off in the US were comments from US President Obama that Russia can’t run “roughshod over its neighbours” and the threat of ramped up sanctions and escalated tensions.
– At the close, the Dow fell 0.6% or 90 points to 16, 269, the Nasdaq had another big fall, down 1.42%, while the S&P 500 lost 13 points to 1,853. 1830 is the key level in futures terms to watch.
– In Europe, the continent will have some catch-up selling this afternoon when it enters the fray as only the FTSE reacted to the moves in the US finishing flat for no change. The DAX was 1.18% higher, the CAC is 0.94% up while in Milan and Madrid, the rises were 1.37% and 1.51% respectively.
– Locally, overnight the June SPI 200 contract fell 33 points to 5335 bid.
– On interest rate markets, US 10’s rallied 6 points to 2.70% while Gilts and Bunds rallied just a point to 1.57% and 2.70% respectively. Locally, the 10-year bond futures on the SFE rose 4 points to 95.915 (4.085%) while the 3’s rose 1 point to 96.95 (4.05%)
– On Forex markets, the weak US data (core durables -1.3%) had little impact on the US dollar against the euro, which pulled back to 1.3782 this morning. This helped USDJPY pullback to 101.99 while sterling’s recovery off trendline support continued and it sits at 1.6576 this morning. The Aussie is higher at 0.9222 this morning after a 0.9244 high overnight.
– On Commodity markets, Gold is the big mover again, trading under $1,300 and it sits this morning at $1,303. Nymex crude is up $1 to $100.25. Copper fell 4 cents back to $3.01 lb. On the Ags, Corn fell 0.26%, Wheat dropped 1.62% while Soybeans rose 0.84%.
On the data front today, HIA housing affordability data is due in Australia along with Kiwi trade data. Then we have Japanese bond investment before retail sales in the UK, followed by US GDP (the third read) and jobless claims.
Here is Ric Spooner’s Stock to Watch Today
Traders looking to buy BHP around trendline support had to be pretty fleet-footed.
Speculation about economic stimulus in China has seen price reject this trendline just above $35 for the 3rd time. The rally appeared to gain momentum yesterday when price gapped above the 200 day moving average. This had been tracking close to the support line, adding to its potential significance.