Global Fundamental Analysis 24/09/2020

Global Fundamental Analysis 24/09/2020, FP Markets

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

U.S. stocks fell, led by losses in tech stocks. The yield on the 10-year Treasury was flat at 0.67%. The WSJ Dollar Index continued to climb higher, reaching 88.35. Oil prices rose as data showed inventories are tightening. Gold prices were pushed lower by the dollar’s strength.
Overnight Summary



Australian Market

Australian shares rose 2.4%, ending their worst losing streak since April with their best day since June. All 12 sectors on the S&P/ASX 200 rose by 1.1% or more, with industrials rising 4%.

New Zealand’s NZX-50 index closed 0.8% higher, with exporters again advancing as the RBNZ’s monetary policy review kept the kiwi under pressure. The RBNZ said more stimulus might be needed, including negative interest rates and a new lending program.


US Market

U.S. stocks fell sharply, extending their turbulent run as hopes for additional fiscal stimulus dimmed, coronavirus cases rose and investors continued to question the valuations of tech stocks.

The S&P 500 was down 2.4% as of the 4 p.m. close of trading in New York, following a rally of more than 1% Tuesday. The Dow Jones Industrial Average fell around 1.9%, while the tech-heavy Nasdaq Composite dropped 3.0%.



Gold futures fell sharply to settle at their lowest level in two months, succumbing to the strength in the U.S. dollar.

December gold lost nearly 2.1%, to end the session at $1,868.40 an ounce, the lowest settlement for a most-active contract since July 22, according to FactSet data.


Oil Futures

U.S. benchmark oil prices ended the session 0.3% higher at $39.93 a barrel as another weekly drop in U.S. crude-oil inventories helped buoy prices amid a strengthening dollar.

The Energy Information Administration said U.S. crude stockpiles fell 1.6 million barrels last week to 494 million barrels, the lowest total since early April when coronavirus began to seriously dent demand.



Major currencies eased against the US dollar in European and US trade. The Euro fell from highs near US$1.1717 to lows near US$1.1649 and was near US $1.1655 at the US close. The Aussie dollar fell from highs near US71.35 cents to lows near US70.68 cents and was near US70.70 cents at the US close. And the Japanese yen eased from 104.92 yen per US dollar to JPY105.47 and was near JPY105.40 at the US close.


European Markets

European share markets rose on Wednesday. The pan-European STOXX 600 index lifted by 0.6%. IHS Market’s ‘flash’ purchasing managers’ index for the eurozone fell to 50.1 in September from August’s 51.9 (survey: 51.7). Shares of German sportswear brands Adidas (+4.4%) and Puma (+4.1%) both lifted, buoyed by a strong earnings report from Nike. The German Dax index rose by 0.4%. The UK FTSE index lifted 1.2% with London-listed shares of Rio Tinto (+0.1%) and BHP (+0.6%) both up.


Asian Markets

Chinese stocks ended higher, as the market recovered from recent declines. The benchmark Shanghai Composite Index added 0.2%, while the Shenzhen Composite Index gained 0.8%. The tech-laden ChiNext Price Index rose the most, ending 1.7% higher.

Japanese stocks closed slightly lower as losses in electronics and auto stocks helped offset gains in e-commerce and tech stocks. The Nikkei Stock Average declined 0.1%.

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