Global Fundamental Analysis 23/09/2020

Global Fundamental Analysis 23/09/2020, FP Markets

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


U.S. stocks rebounded from a poor start to the week, settling higher. The yield on the 10-year Treasury was flat at 0.67%. The WSJ Dollar Index climbed to 88.81. Oil prices nudged higher as concerns over Gulf storms eased. Gold prices suffered a second-straight loss amid a strengthening dollar.

Overnight Summary



Australian Market

Australian shares dropped 0.7% to 5784.1, falling for a fourth straight session for the first time since April. Materials and financials again weighed heavily on the benchmark S&P/ASX 200 index, which has slipped 2.9% over its current losing streak to its lowest close since June 15.


US Market

U.S. stock rose, stabilizing after a bout of volatility that has tested investors confidence in the market’s months long rebound.

The S&P 500 added 1.1% and the Nasdaq Composite rose 1.7%, while the Dow Jones Industrial Average was up 0.5%. The moves come one day after equities retreated sharply, pushing the S&P 500 to a fourth straight day of losses, the longest losing streak for the broad gauge since late February.



Gold futures tallied a second loss in a row, with strength in the U.S. dollar continuing to pressure dollar-denominated prices for the metal.

December gold fell $3, or 0.2%, to settle at $1,907.60 an ounce.


Oil Futures

U.S. benchmark oil prices ended the session slightly higher, up 0.7% at $39.60 a barrel in a choppy, directionless trading session ahead of the release of a pair of weekly U.S. inventory reports.

The modest gains in crude were driven by an uptick in U.S. stock market prices, which helped boost risk appetite in commodity markets, and by a general easing of concerns over hurricanes and tropical storms.



Major currencies eased against the US dollar in European and US trade. The Euro fell from near US$1.1765 to US$1.1690 and was near US$1.1710 at the US close. The Aussie dollar fell from US72.30 cents to US71.55 cents and was near US71.70 cents at the US close. And the Japanese yen eased from 104.40 yen per US dollar to JPY105.05 and was near JPY104.90 at the US close.


European Markets

European share-markets rose on Tuesday, supported by oil and tobacco sectors. Shares in British American Tobacco rose 4.1% on a broker rating upgrade. Shares in Royal Dutch Shell and BP rose 2.5 – 3.0%. The Ifo Institute upgraded forecasts for the German economy, now tipping a 5.2% fall in output this year. The pan-European STOXX 600 index lifted by 0.2%. The German Dax index and the UK FTSE index both lifted 0.4%. But in London trade, Rio Tinto fell by 0.7% with shares in BHP down by 0.2%.


Asian Markets

China’s major stock benchmarks closed lower in line with broadly weaker Asian equities amid risk-averse sentiment due to fears of new Covid-19 surges and uncertainty surrounding the U.S. elections. The Shanghai Composite Index fell 1.3%, while the Shenzhen Composite Index fell 1.1% and the ChiNext Price Index dropped 0.5%.

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