Global Fundamental Analysis 02/11/2021

Global Fundamental Analysis 02/11/2021, FP Markets

Opening Call: The Australian share market is to open lower.


U.S. stocks finished higher as the DJIA briefly jumped above 36000. The yield on the 10-year Treasury note rose to 1.591%, compared with 1.555% on Friday. The WSJ Dollar Index fell 0.12% to 88.28. U.S. oil futures ended higher with OPEC+ expected to keep its current output deal in place this week. Gold futures ended higher, but the $1,800 level stayed out of reach as investors eye this week’s Fed meeting. 


Australian Market

Australia’s S&P/ASX 200 index recovered from an early wobble to close 0.6% higher, despite Westpac’s biggest one-day decline since March 2020. Most sectors showed gains as the ASX 200 followed U.S. stocks’ positive lead from the end of last week. The financials sector was dragged lower by a 7.4% drop from Westpac, its largest loss since the early days of the Covid-19 pandemic.


US Market

U.S. stocks continued a weekslong march higher, a display of investor confidence in the economy’s bumpy recovery. The Dow Jones Industrial Average closed up 0.3% — briefly jumping above 36000 for the first time in the first 15 minutes of trading. The S&P 500 finished 0.2% higher after the index closed out in October with its best monthly performance since November 2020. The technology-focused Nasdaq Composite advanced 0.6%. All three indexes were at record levels.  

Companies that have reported earnings so far have signalled solid customer demand. That has assuaged some investors’ concerns about supply-chain disruptions and rising prices. The Nikkei Stock Average closed 6.7% higher, led by electronics shares, as the ruling Liberal Democratic Party’s election victory on Sunday increased the prospect of political stability.



Gold futures settled higher but remained below the key $1,800 mark as investors weighed the latest reading on the U.S. manufacturing sector ahead of this week’s Federal Reserve meeting and monthly nonfarm payrolls data. December gold rose 0.7% to settle at $1,795.80 an ounce on Comex, after trading as high as $1,797.50.


Oil Futures

Oil futures kicked off November again after hitting multiyear highs last month, as investors expect the Organization of the Petroleum Exporting Countries and their allies to remain reluctant to accelerate production increases despite tightening crude supplies.

West Texas Intermediate crude for December delivery rose 0.6% to settle at $84.05 a barrel on the New York Mercantile Exchange. The U.S. benchmark rose 11% in October, but lost 0.9% last week, ending a streak of nine straight weekly gains. January Brent crude, the global benchmark, added 1.2% to $84.71 a barrel on ICE Futures Europe.



Major currencies were mixed against the US dollar in European and US trade. The Euro held between US$1.1540 and US$1.1610 and was near US$1.1605 at the US close. The Aussie dollar held between US74.80 cents and US75.35 cents and was near US75.15 cents at the US close. And the Japanese yen held between 113.90 yen per US dollar and JPY114.45 and was near JPY114.00 at the
US close.


European Markets

European share markets were firmer on Monday. The pan-European STOXX 600 index rose by 0.7% to record highs, supported by a 1.4% lift in bank stocks. Shares in the world’s largest jewellery
maker, Pandora, fell 1.2% in response to weaker third-quarter sales. And shares in UK bank, Barclays, fell by 1.6% on news that its chief executive officer would resign. The German Dax rose by 0.8% and the UK FTSE index rose by 0.7%. In London trade shares in Rio Tinto were flat and BHP shares fell by 0.6%.


Asian Markets

Chinese stocks finished mixed, as investors reacted to companies’ recent quarterly earnings results. The Shanghai Composite Index dropped 0.1%, the Shenzhen Composite Index was 0.5% higher, and the ChiNext Price Index shed 0.6%.

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