Global Fundamental Analysis 11/08/2021

Global Fundamental Analysis 11/08/2021, FP Markets

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

U.S. stocks finished mostly higher as the earnings season winds down. The 10-year Treasury note yield was at 1.35%, compared with 1.32% on Monday. The WSJ Dollar Index rose 0.06% to 87.64. U.S. oil prices bounced higher, erasing Monday’s loss as traders cheered the Senate’s passage of an infrastructure bill. Gold futures eked out a slight gain to halt the three-session selloff.

Australian Market

Australia’s S&P/ASX 200 index rose 0.3% to a record as investors bought tech and financial stocks despite a survey showing Covid lockdowns severely eroding business sentiment. The index shrugged off a mostly negative lead from U.S. stocks to close at a record for the fifth time in seven sessions. The tech sector rose 1.6%.


US Market

U.S. stocks ended mostly higher as investors weighed strong earnings along with Covid-19 worries. The Dow Jones Industrial Average gained 0.5% while the S&P 500 added 0.1%. The technology-heavy Nasdaq Composite dropped about 0.5%, weighed down by losses in big tech stocks. The earnings season that is now winding down has bolstered the case for stocks, with analysts expecting that profits from companies in the S&P 500 grew 90% in the second quarter from a year earlier, easily surpassing earlier projections. At the same time, many investors are watching with concern the increase in Covid-19 cases in the U.S.



Gold futures settled higher for the first time in four sessions, with bullion eking out again after putting in the lowest settlement since March on Monday.

December gold ended 0.3% higher at $1,729.90 an ounce, a day after bullion skidded 2.1% for the lowest settlement since March 31. The gain marks the first session since Aug. 4 that the precious metal settled in positive territory. “Gold has stabilised after a turbulent start to the week,” wrote Craig Erlam, senior market analyst at Oanda, in a research note.


Oil Futures

Oil futures ended higher, bouncing after holding support above the July lows seen in a sharp selloff during the previous session which was blamed partly on fears that the global spread of the Delta variant of the coronavirus that causes Covid-19 would dent demand.  

West Texas Intermediate crude for September delivery rose 2.7% to close at $68.29 a barrel on the New York Mercantile Exchange. October Brent crude rose 2.3% to finish at $70.63 a barrel on ICE Futures Europe. “Crude prices are rebounding as the rout that stemmed from Delta variant concerns has run its course,” said Edward Moya, senior market analyst at Oanda, in a note.



Major currencies were mixed against the US dollar in European and US trade. The Euro fell from highs near US$1.1740 to lows near US$1.1710 and was near US$1.1715 at the US close. The Aussie dollar rose from lows near US73.20 cents to highs near US73.55 cents and was near US73.45 cents at the US close. The Japanese yen eased from near 110.30 yen per US dollar to JPY110.59 and was near these levels at the US close.


European Markets

European sharemarkets rose on Tuesday with strong earnings results offsetting concerns about the delta variant of covid-19. Travel & leisure rose 2%, driven by positive profit guidance by Flutter Entertainment – the world’s largest online betting group. Shares in Flutter rose by 8.6%. The pan-European STOXX 600 index rose by 0.4%, hitting record highs for a seventh straight session. The German Dax index lifted by 0.2%, and the UK FTSE index was up by 0.4%. In London trade shares in Rio Tinto rose by 1.2% while shares in BHP rose by 0.9%.


Asian Markets

Japan’s Nikkei Stock Average rose as the yen’s weakness offset concerns over the surge of Covid-19 and its Delta variant in Japan and most parts of Asia. The Nikkei closed 0.2% higher, with gains led by pharmaceutical names.  

Chinese stocks rose, as liquor makers and financials rebounded. The Shanghai Composite Index rose 1.0%, the Shenzhen Composite Index gained 0.9%, and the ChiNext Price Index added 0.3%. Dongguan Securities expects A-shares to keep rebounding amid net inflows. Liquor stocks recovered after taking a hit last week amid regulatory crackdown concerns.

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