Global Fundamental Analysis 17/08/2020

Global Fundamental Analysis 17/08/2020, FP Markets

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


U.S. stocks were mixed as investors wondered what the continued impact of the pandemic will mean. The WSJ Dollar Index fell 0.14% to 88.53. The yield on the 10-year Treasury slipped to 0.708% on the day, but strengthened on the week. Oil prices fell on demand worries, but gained for the week amid lower production. Gold prices reversed course and fell after two days of gains.


Overnight Summary




Australian Market

Australian shares rose 0.6% to 6126.2, led by an end-of-week surge by tech stocks. Eleven of 12 sectors on the benchmark S&P/ASX 200 index rose, with tech jumping 4.2% following a strong overnight lead by the Nasdaq Composite.


US Market

U.S. stocks struggled to find direction, but the S&P 500 still managed to notch meager gains for the week while hovering just below its February record.

The broad index fell less than 0.1% as of the 4 p.m. ET close of trading, the latest in a series of modest moves that have left major indexes little changed from where they were a week earlier.

The Dow Jones Industrial Average rose 34 points, or 0.1%, to 27931.02. The Nasdaq Composite remained in the red, down 0.2%, as Apple, Facebook and all notched small losses.

Industrial and energy stocks scored the biggest gains of the day, rising 0.4% and 0.9%, respectively.



Gold futures fell, pulling back after two straight days of gains, with prices registering their first weekly loss in 10 weeks on the back of recent strength in U.S. Treasury yields.

December gold retreated $20.60, or nearly 1.1%, to settle at $1,949.80 an ounce, after climbing 1.1% on Thursday. Gold prices saw a weekly decline of about 3.9%, based on the most-active contract’s settlement last Friday, which snapped a nine-week win streak, according to Fact-Set data.


Oil Futures

U.S. benchmark oil prices dipped 0.5% on the day, but notched a 1.9% gain for the week at $42.01 a barrel as declining U.S. inventories and crude production pointed to a much tighter market despite lingering concerns of weak demand.

Rig data from oilfield services company Baker Hughes was bullish for oil prices, as it showed the oil rig-count fell to a fresh, 15-year-low.

Additionally, Reuters reported China is ramping up purchases of U.S. crude oil ahead of a trade deal review.



Major currencies were firmer against the US dollar in European and US trade. The Euro rose from lows near US$1.1785 to highs near US$1.1850 and was near US$1.1840 at the US close. The Aussie dollar rose from lows near US71.35 cents to highs near US71.75 cents and was near US71.70 cents at the US close. And the Japanese yen lifted from 106.90 yen per US dollar to JPY106.45 and was near JPY106.60 at the US close.


European Markets

European share-markets finished lower in thin trade on Friday. Travel stocks fell after the UK added more countries to its quarantine list. The pan-European STOXX 600 index was down 1.2% with travel & leisure stocks down 2.3%. Lacklustre retail sales data in the US and China weighed on investor sentiment. The German Dax index fell by 0.7%. And the UK FTSE index lost 1.6%. In London trade, shares in Rio Tinto fell by 1.0% and shares in BHP closed lower by 0.5%.


Asian Markets

Earlier Friday, China’s major stock benchmarks staged a late comeback to settle higher. The Shanghai Composite Index rose 1.2% to 3360.10, the smaller Shenzhen Composite Index gained 1.3% and the ChiNext Price Index advanced 1.8%. Overseas investors helped push the indexes higher with net buying via Hong Kong’s stock connect in the afternoon.

Japanese stocks closed higher, with the Nikkei Stock Average rising 0.2% at 23289.36, helped by pharmaceutical and insurance stocks. Investors are likely to keep watch on developments from U.S.-China trade talks later this weekend.

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Source - database | Page ID - 21918

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