Global Fundamental Analysis 13/10/2021

Global Fundamental Analysis 13/10/2021, FP Markets

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


U.S. stocks edged lower as investors look to the start of an earnings season. The yield on the 10-year Treasury note declined 2.5 basis points to 1.57%, compared with 1.60% on Friday. The WSJ Dollar Index rose 0.11% to 88.90. U.S. oil prices tallied their fourth straight gain, but Brent ended lower as the IMF trimmed its global growth outlook. Gold futures posted their first gain in four sessions to settle at their highest in nearly a week.


Australian Market

Australia’s S&P/ASX 200 index closed a volatile session 0.3% lower. The tech, utility and energy sectors were the biggest losers, the latter giving away strong early gains amid higher overnight oil prices. Westpac dropped 1.65% after flagging A$1.3 billion in write-downs and other one-offs, helping pull the heavyweight financial sector 0.35% lower.


US Market

U.S. stocks inched lower amid losses in communications companies. The Dow Jones Industrial Average lost 0.3%. The S&P 500 ticked down 0.2% while the tech-heavy Nasdaq Composite declined 0.1%. Stock indexes have been dragged lower in choppy trading in recent weeks. Investors are contending with an energy crunch that threatens to add to inflationary pressures just as signs emerge that global economic growth is slowing. The third-quarter earnings season, which begins Wednesday, will provide clues on how companies are faring with price increases.



Gold futures marked the first gain in four sessions, with prices for the precious metal settling at their highest in almost a week after the International Monetary Fund said the global economy is losing momentum. December gold rose 0.2% to settle at $1,759.30 an ounce, following a 0.1% decline on Monday, which marked a third consecutive decline.

Prices for the most active contact logged the highest finish since Oct. 6, FactSet data show. “The IMF report has dented the outlook for the U.S. economy, and this has made gold trade attractive once again,” said Naeem Aslam, chief market analyst at AvaTrade. However, “the gains may be short lived as we really do not see any major buying pressure backing up the current move.”


Oil Futures

Oil futures ended on a mixed note, with U.S. prices stretching their streak of gains to a fourth session, while global crude benchmark prices settled lower after the International Monetary Fund trimmed its global economic growth forecast. West Texas Intermediate crude for November delivery briefly fell back toward $80 a barrel on the New York Mercantile Exchange but moved up by nearly 0.2% to settle at $80.64 a barrel. WTI marked its second straight finish above the key $80 mark and saw the highest finish since Oct. 30, 2014, according to Dow Jones Market Data. Global benchmark December Brent crude, however, lost 0.3% to settle at $83.42 a barrel, after settling Monday at a nearly three-year high.



Major currencies were mixed against the US dollar in European and US trade. The Euro fell from highs near US$1.1570 to lows near US$1.1525 and was near US$1.1530 at the US close. The Aussie
dollar rose from lows near US73.45 cents to highs near US73.85 cents and was near US73.50 cents at the US close. And the Japanese yen eased from 113 yen per US dollar to JPY113.77 and was near JPY113.65 at the US close.


European Markets

European share markets were modestly weaker on Tuesday. Investors fretted that rising inflation would crimp company profits. And there also were concerns about the Chinese property sector
after Evergrande missed another bond payment. Mining fell 0.7% with autos and travel down near 0.4%. Utilities and real estate rose by 1%. The pan-European STOXX 600 index fell by 0.1.% The
German Dax index fell 0.3%, and the UK FTSE index lost 0.2%. In London trade shares in Rio Tinto fell 1.9% and BHP shares lost 1.2%.


Asian Markets

Japanese stocks ended lower, dragged by declines in tech and retail stocks amid continuing concerns about higher costs of borrowing and raw materials. The Nikkei Stock Average fell 0.9%. Investors are focusing on crude oil prices and new Prime Minister Fumio Kishida’s economic initiatives. Chinese stocks ended the session lower, as the downtrend for steelmakers and mining companies continued.

The Chinese central bank withdrew CNY280 billion on a net basis in reverse-repo operations over the past two days, according to Wind, which may have hurt investor sentiment and affected liquidity in the market. Major property developers broadly rose. The Shanghai Composite Index dropped 1.2%, the Shenzhen Composite Index declined 1.6%, and the ChiNext Price Index was 1.8% lower.

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Source - database | Page ID - 21848

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