Global Fundamental Analysis 19/11/2021

Global Fundamental Analysis 19/11/2021, FP Markets

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


U.S. stocks closed mostly higher following earnings from Macy’s and Kohls. The yield on the 10-year Treasury note fell to 1.58% from 1.60% on Wednesday. The WSJ Dollar Index fell 0.13% to 89.43. U.S. oil futures rebounded following reports earlier in the week of a U.S. push for the coordinated release of crude reserves sent prices to six-week lows. And gold futures ended lower, a day after posting the highest settlement since June.


Australian Market

Australia’s S&P/ASX 200 index closed 0.1% higher, edging up amid gains by materials stocks. The benchmark ended a run of consecutive losses despite another slip by Commonwealth Bank, which lost 1.5%, a day after the country’s largest listed company by market capitalization suffered its fifth-biggest share-price fall. The two best-performing ASX components were both in the materials sector.


US Market

U.S. stocks wavered as Macy’s and Kohl’s posted strong earnings and unemployment data showed the labour market is continuing to recover. The S&P 500 ticked up 0.3% to a fresh record high, reversing Wednesday’s 0.3% losses. The Nasdaq Composite Index rose 0.5%, also reaching a new high, as technology stocks added to early gains. The Dow Jones Industrial Average slipped 0.2%.  

Shares of Macy’s surged 21% and Kohl’s jumped 7.8%, as both retailers released earnings that beat analysts’ estimates and raised their full-year guidance. “Consumers are taking whatever is on the shelves at whatever prices they are listed at, so that’s really good for retailers and margins,” said George Cipolloni, a portfolio manager at Penn Mutual Asset Management, who is recommending holding small-cap stocks.



Gold futures took a breather, with prices settling with a loss a day after the most-active contract marked its highest settlement in June. December gold fell 0.5% to settle at $1,861.40 an ounce, following a 0.9% gain on Wednesday, which took the precious metal to the highest finish since June 11, FactSet data show. “Gold prices have been soaring for the last number of weeks and it is natural for traders to book some profit,” said Naeem Aslam, chief market analyst at AvaTrade.


Oil Futures

Oil futures finished higher, with prices rebounding after dropping to their lowest levels in about six weeks on reports that China plans a release of crude from its reserve and the Biden administration has been pressing other countries to join in. West Texas Intermediate crude for December delivery rose 0.8% to settle $79.01 a barrel on the New York Mercantile Exchange after touching an intraday low of $77.08. January Brent crude, the global benchmark, tacked on 1.2% to $81.24 a barrel.



Major currencies were mixed against the US dollar in European and US trade. The Euro rose from US$1.1315 to highs near US$1.1375 and was near US$1.1370 in afternoon US trade. The Aussie dollar fell from highs near US72.90 cents to lows near US72.50 cents and was near US72.75 cents in afternoon US trade. And the Japanese yen eased from 113.97 yen per US dollar to JPY114.46 and was near JPY114.25 in afternoon US trade.


European Markets

European share markets were weaker on Thursday. The pan-European STOXX 600 index fell for the first time in seven days, down by 0.5% from record highs. Energy and mining both lost 1.7% due to lower commodity prices. Reuters reported that “Submarines-to-steel group Thyssenkrupp jumped 6.3% after it said profit could more than double next year and it may take its hydrogen unit public.” The German Dax index lost 0.2% from record highs. The UK FTSE index fell by 0.5%. In London trade shares in Rio Tinto fell by 1.7% and BHP fell by 1.1%.


Asian Markets

Japan’s Nikkei Stock Average closed 0.3% lower, dragged by falls in energy and shipping companies following weaker crude oil prices overnight. Investors are focusing on Japan’s fiscal stimulus and any other economic initiatives by Prime Minister Fumio Kishida. Chinese stocks finished the session lower, as property developers declined. 

Property-sector data for October deteriorated further, and the government’s easing so far hasn’t been enough to turn consumer confidence around, Orient Securities said. The Shanghai Composite Index slipped 0.5%, the Shenzhen Composite Index lost 0.7%, and the ChiNext Price Index was 1.1% lower.

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