Global Fundamental Analysis 14/08/2020

Global Fundamental Analysis 14/08/2020, FP Markets

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


U.S. stocks closed lower despite jobless claims fall. The yield on the benchmark 10-year U.S. Treasury note settled up to 0.716% from 0.669% after weak demand in a $26 billion auction of 30-year bonds. The WSJ Dollar Index was recently down 0.12% at 88.67.

Crude-oil prices settled lowered after forecasters cut their 2020 demand forecast. Gold futures notched back-to-back gains.


Overnight Summary




Australian Market

Australia’s S&P/ASX 200 index closed 0.7% lower at 6091.0, weighed by negative reaction to the outlook that accompanied earnings reports from the likes of Telstra, Breville and AGL Energy.


US Market

U.S. stocks slipped after data showed fewer Americans applied for jobless benefits, potentially signaling that the pace of recovery in the labor market is starting to pick up.

The S&P 500 dropped 0.2% as of the 4 p.m. ET close of trading, still remaining close to its first record since the corona virus pandemic disrupted the economy. The Dow Jones Industrial Average dropped 0.3%, or 80 points, while the tech-heavy Nasdaq Composite Index rose 0.3%.



Gold futures notched a back-to-back gain, after taking a brief dip in the wake of weekly U.S. jobless claims data that showed a fall below one million for the first time since the corona-virus pandemic began almost five months ago.

December gold climbed $21.40, or 1.1%, to settle at $1,970.40 an ounce, after tapping an intraday low of $1,923. Prices for the contract remained lower for the week, down more than 3% from last Friday’s settlement, according to Fact-Set data.


Oil Futures

Oil futures finished lower, pressured after the International Energy Agency applied a deeper cut to its forecast for global crude demand in 2020 and as news of diplomatic progress among two Arab nations eased risks to supply from the region.

West Texas Intermediate crude for September delivery on the New York Mercantile Exchange lost 43 cents, or 1%, to settle at $42.24 a barrel after spending part of the session flipping between small gains and losses. The global benchmark, October Brent crude shed 47 cents, or 1%, at $44.96 a barrel on the ICE Futures Europe.



Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.1861 to lows near US$1.1794 and was near US$1.1810 at the US close. The Aussie dollar fell from highs near US71.80 cents to lows near US71.36 cents and was near US71.45 cents at the US close. And the Japanese yen eased from 106.57 yen per US dollar to JPY107.04 and was near JPY106.90 at the US close.


European Markets

European share-markets finished lower on Thursday with the pan-European STOXX 600 index down 0.6%. Thyssenkrupp was the worst performer with shares closing 16.3% lower after the German steel company posted a €679 million quarterly loss. The German Dax index fell by 0.5%. And the UK FTSE index lost 1.5% as the pound strengthened and AstraZeneca (-1.8%), BP  -3.2%) and GlaxoSmithKline (-2.6%) all traded without entitlement to a dividend payout, hitting their shares. In London trade, shares in Rio Tinto fell by 1.8% and shares in BHP closed lower by 1.3%.


Asian Markets

Earlier in the day in Asia, the Nikkei Stock Average ended higher, rising 1.8% to close at 23249.61 after hitting its highest intraday level since February.

Mainland China’s major stock benchmarks ended mixed. The Shanghai Composite Index was little changed, adding only 1.46 points, while the smaller Shenzhen Composite Index eked out a 0.1% gain. The Chi-next Price Index, which reflects retail investor sentiment, closed 0.5% lower, logging its sixth-straight session of loss.

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