From David Scutt, Treasury Dealer at Arab Bank, here’s a quick run-through of what’s got the Australian market buzzing this morning, including the big reports and consumer sentiment.
– A big day on the domestic earnings front with CBA, CSL, Leighton Holdings, Southern Cross Media and WorleyParsons all scheduled to report.
– The ASX 200 looks set to extend its winning streak this morning with SPI futures pointing to a gain of 17pts on the open. Given what was witnessed yesterday, stocks rallying pre-emptively before earnings announcements today, it will be interesting to see whether we’ll see a bout of ‘buying the rumour, selling the fact’ once earnings hit the screens. Certainly the price action recently suggests investor expectations are far higher than that of analysts, a scenario that suggests we’ll see profit-taking on any at-or-below earnings announcement.
– Having tumbled as low as .9074 earlier in the session, the AUDUSD has recovered in the latter parts of trade, thanks largely to Lockhart’s words, with the pair currently fetching .9109. With markets still no closer to determining when tapering will start and with no major data scheduled, range trading is favoured as participants await bigger events later in the session. Support is found at .9100 and again at .9074 with resistance likely to kick in on any move back towards .9150.
– Domestic releases today include Westpac-MI consumer sentiment for July along with the Q2 wage price index. Regionally, we’ll also receive New Zealand Q2 retail sales along with unemployment and revised July trade figures from South Korea.
– A big data calendar this evening with GDP figures from the Eurozone, Germany and France the undisputed headline acts. Elsewhere we’ll also receive UK unemployment and minutes from the latest BoE MPC meeting in the UK, CPI and non-farm payrolls from France, Swiss producer prices, Indian wholesale price inflation along with PPI and MBA mortgage market index from the States. On the tapering front, St Louis Fed President James Bullard is also scheduled to speak.