Global Fundamental Analysis 20/08/2020

Global Fundamental Analysis 20/08/2020, FP Markets

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


U.S. stocks settled lower a day after the S&P reached a record high. The WSJ Dollar Index was recently up 0.63% to 88.44. The yield on the benchmark 10-year Treasury note rose to 0.685%, from 0.668% on Tuesday. Oil prices were little changed. Copper futures crossed the $3 threshold on strong Chinese demand.

Overnight Summary



Australian Market

Australian shares rose 0.7% to 6167.6, propelled by positive reaction to annual earnings reports. The health sector was the standout performer on the benchmark S&P/ASX 200 index, rising 4.0%.


US Market

U.S. stocks swung between small gains and losses, a day after the S&P 500 set its first record close since February, as investors held out cautious hopes for a continued economic recovery.

The broad stock-market index was down 0.4% as of the 4 p.m. close of trading in New York, while the Dow Jones Industrial Average was off 0.3%. The technology-heavy Nasdaq Composite fell 0.6%.



Copper rose above $3 a pound for the first time in more than two years, extending a recent rally driven by steady Chinese demand and disruptions to global supply.

Most actively traded copper futures for delivery in September added 1.6% to $3.0230 a pound, the first time they have eclipsed the closely watched $3 level since June 2018.

Meanwhile, most actively traded gold futures for December delivery slid 2.1% to $1,970.30 a troy ounce, extending a recent stretch of volatility for the precious metal.


Oil Futures

U.S. benchmark oil prices edged 0.1% higher to reach five-month closing high of $42.93 a barrel.



Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.1950 to lows near US$1.1830 and was near US$1.1845 at the US close. The Aussie dollar fell from highs near US72.75 cents to lows near US71.85 cents and was near lows at the US close. And the Japanese yen eased from near 105.15 yen per US dollar to JPY106.06 and was near weakest levels at the US close.


European Markets

European share-markets finished higher on Wednesday, taking guidance from record closes on Tuesday for the US Nasdaq and S&P 500 indexes. Reuters reported that “British Airways-owner IAG rose 7.6% and easyJet rose 3.3% on news that Britain’s government was working with Heath-row Airport on a plan to use COVID-19 testing to help shorten quarantine times.” The pan-European STOXX 600 index rose by 0.7%. The German Dax index also rose by 0.7%. And the UK FTSE index lifted by 0.6%. In London trade, shares in Rio Tinto fell by 0.1% and shares in BHP fell by 0.3%.


Asian Markets

Chinese stocks fell, as the benchmark Shanghai Composite Index snapped a four-day rally. The index declined 1.2%, its largest one-day loss since late July, to settle at 3408.13. The Shenzhen Composite Index shed 2.0% to 2253.68 while the ChiNext Price Index slipped 3.3% to 2612.84. Electronics companies led the downturn.

The Nikkei Stock Average nudged 0.3% higher to 23110.61, following news that Japan’s exports fell at a slower pace in July supported by demand recovery from China. Real estate stocks were among the prominent gainers.

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