Global Fundamental Analysis 25/09/2020

Global Fundamental Analysis 25/09/2020, FP Markets

OPENING CALL: The Australian share market is to open higher.

U.S. stocks managed a small climb as tech stocks rebounded. The yield on the 10-year Treasury ticked lower to 0.67%. The WSJ Dollar Index nudged lower to 89.29. Oil prices followed equities higher. Gold prices rose for the first time in four sessions.


Overnight Summary


Australian Market

Australian shares slipped 0.8% to 5875.9, dropping for the fourth time in five sessions. Tech stocks led losses with a 2.7% fall as all 12 sectors on the S&P/ASX 200 index finished lower and the benchmark index gave up some of its strong gains from the previous day.

US Market

The S&P 500 closed higher, as the broad index averted a correction while technology stocks recovered recent losses.

Shares of Apple, Microsoft and other technology stocks scored gains in a topsy-turvy session that had seen major indexes bob above and below the flatline several times.

The index was up 0.3% to 3246 as of 4 p.m ET. It needed to close at or below 3222.76 to enter a correction, which would mark a 10% drop from its recent high. The Dow Jones Industrial Average and the Nasdaq Composite swung alongside the S&P 500.


Gold futures tallied their first gain in four sessions, as a recent price drop to a two-month low raised the precious metal’s appeal among bargain hunters.

December gold rose by $8.50, or nearly 0.5%, to settle at $1,876.90 an ounce. Prices based on the most-active contract logged a third straight session decline on Wednesday and settled at their lowest since late July.

Oil Futures

WTI oil prices rose 1% to $40.31 a barrel in a choppy trading session dictated almost entirely by movements in U.S. stock markets.

When equities declined early in the New York session, so too did WTI crude, and as stocks on Wall Street rebounded into the afternoon, crude did also as risk appetite improved across commodity markets.


Major currencies were mixed against the US dollar in European and US trade. The Euro rose from lows near US$1.1630 to highs near US$1.1685 and was near US$1.1670 at the US close. The Aussie dollar rose from lows near US70.15 cents to highs near US70.70 cents and was near US70.55 cents at the US close. And the Japanese yen eased from 105.20 yen per US dollar to JPY105.50 and was near JPY105.40 at the US close.

European Markets

European share markets fell on Thursday as a second wave of COVID cases across the region weighed on investor sentiment. Retail stocks fell by 2.2% with oil & gas shares down 2.1%. But surveys of business sentiment in Germany and France improved for the fifth straight month. The pan-European STOXX 600 index fell by 1.0%. The German Dax index lost 0.3%. The UK FTSE index eased by 1.3%. In London trade, shares in Rio Tinto rose by 0.7% while shares in BHP rose by 0.1%.

Asian Markets

Chinese stocks dropped, with the market erasing the previous day’s gains. The benchmark Shanghai Composite Index fell 1.7%, its steepest one-day loss in two weeks. The Shenzhen Composite Index lost 2.5%, while the ChiNext Price Index shed 2.5%.

Japanese stocks closed broadly lower amid concerns about the sustainability of recent sharp gains in technology shares. SoftBank Group fell 4.5% and chip maker Renesas Electronics dropped 3.7%. The Nikkei Stock Average shed 1.1%.

  • Global Fundamental Analysis 25/09/2020, FP Markets
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