Friday: 16th December 2016
Each Market In Focus
- The Australian share market is poised to open higher.
- At 8.00 a.m. AEDT on Friday, the local SPI 200 share price futures index was up ten points, or 0.18 per cent, at 5,495 points.
- In the US, the Dow Jones Industrial Average is up 0.38 per cent with just over an hour until the close, while Nasdaq gained 0.42 per cent.
- In local corporate news, two of the nation’s big four banks will come the under the spotlight. ANZ will hold their annual general meeting in Melbourne, while National Australia Bank will address shareholders in Adelaide.
- Incitec Pivot and Elders will also hold their AGM’s later Friday.
- The Australian share market closed lower on Thursday, hurt by big falls among energy and mining companies.
- The benchmark S&P/ASX 200 index dropped 46 points, or 0.82 per cent, at 5,538.6 points.
- The broader All Ordinaries index fell 44.7 points, or 0.79 per cent, at 5,595 points.
- AUS Elders Ltd (ELD.AU) Full year 2016 AGM
- AUS National Australia Bank Full year 2016 AGM / Webcast (NAB.AU)
- AUS BT Investment Management Ltd Full year 2016 AGM (BTIVF)
- AUS Australia & New Zealand Full year 2016 AGM / Webcast Banking Group Ltd. (ANZ.AU)
- AUS Sims Metal Management Ltd General Meeting re approval amendments of company (SGM.AU)
- AUS Incitec Pivot Limited (IPL.AU) Full year 2016 AGM / Webcast
- AUS Nanosonics Ltd (NAN.AU) Nanosonics Ltd into S&P / ASX 200
- AUS Standard & Poor’s S&P / ASX 200 Index quarterly changes effective after close of trading
- NZ Mainfreight Ltd (MFT.NZ) Interim 2017 Dividend payment date
- AUS Australia & New Zealand Full year 2016 Dividend payment date – proposed Banking Group Ltd. (ANZ.AU)
- AUS Corporate Travel Management Corporate Travel Management Ltd 1-for-21 Ltd (CTD.AU) pro-rata renounceable rights issue offer starts
60 Day Low. This is a list of codes that made a new 60 day LOW in the past 2 days. We use the 60 day low as this would infer that a breakdown in price has occurred after a period of consolidation OR the stock is declining each day if the code shows repeatedly. The filter uses an above 50 cent price filter, and the codes in Blue are on our watch list. ( source Metastock)
- US stocks were off their highs but continued to hover near record levels on Thursday as investors viewed the Federal Reserve’s interest rate outlook as a sign of confidence in the economy.
- The Fed sees three rate hikes next year instead of the two foreseen as of September, partly as a result of the changes anticipated under President-elect Donald Trump.
- Fed Chair Janet Yellen also cited an improving labor market and evidence of faster inflation for its 2017 rate outlook.
- The central bank’s decision to raise rates comes as Trump, who will be sworn in next month, is expected to cut taxes and boost spending on infrastructure.
- Since the US presidential election, stocks have rallied on bets that Trump’s business friendly proposals will stimulate the economy.
- The Dow is less than 100 points shy of the 20,000 mark, while the S&P has risen more than five per cent since November 8.
- Still, there are some concerns that the rally has gone too far too soon and that valuations are slightly stretched.
- The Dow Jones Industrial average was up 107.92 points, or 0.55 per cent, at 19,900.45.
- The S&P 500 was up 12.5 points, or 0.55 per cent, at 2,265.78.
- The Nasdaq Composite was up 33.83 points, or 0.62 per cent, at 5,470.50.
- Ten of the 11 major S&P sectors were higher, with the financial index’s 1.40 per cent rise leading the gainers. The index touched its highest level since February 2008 earlier in the day.
- JPMorgan, Wells Fargo and Bank of America were up between 1.5-2.5 per cent, boosting the S&P.
- Dow was lifted by a 4.3 per cent jump in Goldman Sachs .
- Economic data on Thursday showed U.S. consumer prices moderated in November, but the underlying trend continued to point to firming inflation pressures.
- Yahoo fell 4.8 per cent to $US38.95 after the technology company disclosed a second massive data breach that raised fears Verizon might kill a deal to buy its core internet business.
- Verizon was up 0.7 per cent at $US52.02.
- Copper futures edged lower Wednesday as a stronger dollar provided a headwind to the recent base metals rally.
- Copper for March delivery settled down 0.2% at $2.6005 a pound on the Comex division of the New York Mercantile Exchange.
- Gold dropped to a 10-month low, extending a steep decline as markets adjusted to the prospect of more interest-rate increases next year in the wake of the U.S. Federal Reserve’s meeting.
- Futures for February delivery settled down 2.9% at $1,129.80 a troy ounce, trading at the lowest level since Feb. 2.
- Thursday’s move marked the biggest one-day drop for gold since Nov. 11.
- IRON ORE: $79.94 +0.36 ( December contract )
- Crude prices fell Thursday for the second day in a row as the dollar surged, raising concerns about demand for oil outside the U.S.
- U.S. crude futures for January delivery settled down 14 cents, or 0.27%, at $50.90 a barrel on the New York Mercantile Exchange.
- The February contract for global crude-oil benchmark Brent gained 12 cents, or 0.22%, to $54.02 a barrel on London’s ICE Futures Exchange.
- A stronger U.S. dollar makes oil more expensive for traders using other currencies.
- The U.S. dollar surged to its highest level in 14 years Thursday, battering emerging-market currencies and pushing the euro closer to parity after the U.S. Federal Reserve signaled that it expects to raise interest-rates quicker than previously anticipated.
- A faster-than-expected rise in U.S. interest rates will fuel the dollar’s rally further into next year, with major consequences for U.S. exporters and Asian economies, analysts say.
- The U.S. dollar set a fresh eight-year high against the Chinese yuan.
- The Fed now expects the median fed-funds rate to be 1.4% by the end of 2017, reaching 2.1% at the end of 2018 and 2.9% in 2019. That implies three quarter-percentage-point interest-rate increases over each of the next three years, a faster pace than officials projected in September, when they only saw two rate increases next year.
- The effects of the strong dollar are already rattling across the wider world. A stronger greenback adds pressure on emerging-market nations like China by making their dollar-denominated debt more expensive to pay back and their asset less attractive to investors seeking yield.
- Emerging-markets have already faced aggressive selling and outflows since the U.S. election, prompting central banks in China, Malaysia and Mexico to step in to defend their currencies.
- The Australian dollar has dropped as the US dollar gains further ground following the US Federal Reserve’s recent interest rate hike, with the central bank forecasting another three rate rises next year
- At 8.00 a.m. AEDT on Friday, the local unit was trading at 73.53 US cents, down from 74.14 cents on Thursday.
- European shares rose on Thursday, helped by gains in global banks after the Federal Reserve raised US interest rates, while growing corporate deal activity underpinned year-end optimism.
- The pan-European STOXX 600 index rose 0.9 per cent, ending at its highest level since January 5.
- It is still down nearly two per cent so far in 2016 but could close the year in positive territory if it sees an end-of-year rally.
- The European banking index surged 2.5 per cent, also ending at an 11-month high.
- Deutsche Bank, BNP Paribas, HSBC, Santander and Credit Suisse rose 1.5 to 5.3 per cent after the Fed’s move.
- Banks benefited from gains by short-dated US treasury yields, which touched their highest in more than seven years, after the Fed raised interest rates for the first time in a year and hinted at more in 2017. Higher yields are a boon to banks’ profitability.
- Also helping financials, Italian banks rose 4.4 per cent and were on course for a third straight week of gains.
- Italian banks have staged a rebound since Paolo Gentiloni was appointed prime minister, on expectations that a stable political environment will help ailing banks to recapitalize. Gentiloni has won the backing of the fragmented Senate, allowing his government to formally take office.
- Mining shares, the year’s best performers in Europe, also lost ground, with the sector index falling 2.3 per cent on a firmer dollar following the Fed’s move. A stronger dollar generally makes commodities costlier for other currency holders.
- Precious metals miners were among the hardest hit as gold dropped to its lowest in more than 10 months. Shares in Fresnillo, Randgold Resources, Acacia Mining and Centamin slumped 5.6 to 11.9 per cent.
- Hong Kong stocks slumped to a four-month low on Thursday, tracking Asian markets, after the US Federal Reserve raised interest rates and rate-path projections.
- The benchmark Hang Seng index extended early losses to end down 1.8 per cent, at 22,059.40 points.
- The Hong Kong China Enterprises Index lost 2.3 per cent, to 9,479.16 points.
- The market had priced in the U.S. quarter-point rate increase, but investors were spooked after the Fed projected three hikes next year, up from two previously, indicating a more aggressive tightening path.
- The financial sector also fell sharply, led by mainland banks and insurers, amid concerns of a liquidity crunch there after several China treasury futures contracts fell to their daily limit.
- The S&P/NZX 50 Index on Thursday dropped 49.24 points, or 0.72 per cent, to 6,748.62.
Important News Events For Today
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