Global Fundamental Analysis 13/05/2020

OPENING CALL: The Australian share market is expected to open lower. The SPI200 futures contract expected to open 68 points down.


Saudi Aramco said its first-quarter profit fell and it would cut spending this year, underscoring the twin impact of an oil-price rout and the coronavirus pandemic on the
kingdom’s worsening finances.


A potential deal under discussion would unite two of the biggest players in meal delivery at a time when the coronavirus pandemic has sparked a surge in demand for their


Overnight Summary




Australian Market


US Market

U.S. stocks fell, with all three major indexes finishing lower. The Dow Jones Industrial Average fell 457 points, or 1.9%, to 23765. The S&P 500 and the Nasdaq Composite both lost about 2.1%.

Major indexes had started the day higher. But as the day progressed, they slid, with traders saying the selling didn’t appear to be driven by any single clear catalyst. All
11 sectors of the S&P 500 were lower on the day.

Investors have gotten a look at some troubling reports on the economy in recent days. The Labor Department said Tuesday that its consumer-price index-a measure of prices for goods and services including airfare, clothing and food-fell by 0.8% last month. That marked the largest monthly decline in the index since December 2008.
And at a Senate hearing, top U.S. health officials warned the country should expand testing before reopening the economy.



Gold futures ended higher, with slight support attributed in part to a weaker tone for the U.S. dollar as traders bet on a slow economic recovery, even as
efforts were under way to reopen economies that were closed to contain the COVID-19 pandemic.

Gold for June delivery on Comex rose $8.80, or 0.5%, to settle at $1,706.80 an ounce following losses in each of the last two sessions. July silver added 2.9 cents, or 0.2%, at $15.709 an ounce.


Oil Futures

Oil futures climbed, with U.S. prices settling above $25 a barrel amid expectations that production cuts will help alleviate a glut of crude supplies from the pandemic-related drop in global demand.  Saudi Arabia, Kuwait and the United Arab Emirates have pledged output cuts beyond their share of the OPEC+ agreement.

The Energy Information Administration, meanwhile, reduced its 2020 forecast for U.S. crude production. June West Texas Intermediate oil rose $1.64, or 6.8%, to settle at $25.78 a barrel on the New York Mercantile Exchange.



 The U.S. dollar weakened 0.4% against the euro and yen.  U.S. core CPI plunged for April, the biggest monthly decline in records going back to 1957, as virus-containing efforts hurt demand for energy, goods and services.


European Markets


Asian Markets

Earlier in the day in Asia, stocks dropped on worries a second coronavirus wave may emerge.  The Nikkei 225 eased 0.1% in Tokyo and the Kospi Composite fell 0.7% in Seoul, where authorities are trying to track down nightclub visitors linked to a recent outbreak.

Japanese stocks fell, with the Nikkei Stock Average ending 0.1% lower at 20366.48 amid mixed sentiment over the reopening of economies around the world. Hong Kong shares extended morning losses to end lower, as Asian equities markets broadly weakened amid concerns about a second wave of coronavirus infections and rising trade tensions. The benchmark Hang Seng Index fell 1.5% to settle at 24245.68.

South Korea’s benchmark Kospi closed 0.7% lower at 1922.17, dragged by auto, steel, aviation and refinery stocks. Fears of a resurgence in coronavirus infections and renewed U.S.-Chinese trade disputes weighed on sentiment.

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