Global Fundamental Analysis 24/09/2021

Global Fundamental Analysis 24/09/2021, FP Markets

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

U.S. stocks jumped as markets turned positive for the week. The 10-year Treasury note yield rose 7.6 basis points to 1.42% versus 1.33% on Wednesday. The WSJ Dollar Index fell 0.33% to 87.67. U.S. oil futures ended at their highest since July. Gold settled at its lowest in more than six weeks.

Australian Market

Australia’s S&P/ASX 200 index closed 1.0% higher, with a strong performance in the technology and energy sectors driving the result. All sectors ended the day up, with technology stocks leading the market, up to 3.0%. Energy stocks rose 2.8% amid an oil price uptick. The major banks were up between 0.6% and 1.2%.


US Market

U.S. stocks rose sharply, notching a second-consecutive day of gains as investors remained upbeat that trouble with property giant China Evergrande Group can be contained. The S&P 500 gained 1.2%, a day after a Federal Reserve policy update sent the stocks to gauge to its biggest one-day gain since July. The Dow Jones Industrial Average was up 1.5%. The technology-focused Nasdaq Composite Index added 1%.

All three indexes are now up for the week. Markets have been consumed this week with questions surrounding Evergrande, a giant real-estate developer in China. Many fear its collapse could spread economic pain through the world’s second-largest economy, with spillovers into global financial markets. However, fears around its possible collapse appear to have ebbed – at least temporarily.



Gold futures fell, with prices marking their lowest finish in more than six weeks, as investors gravitated toward equities and away from assets perceived as havens. December gold fell 1.6% to settle at $1,747.90 an ounce. The loss is “related to a combination of factors centred around investor confidence improving and fear to ease,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.


Oil Futures

Oil futures climbed for a third straight session, with global benchmark Brent crude prices scoring their highest finish since October 2018. West Texas Intermediate crude for November delivery rose 1.5% to settle at $73.30 a barrel on the New York Mercantile Exchange.

November Brent crude, the global benchmark, added 1.4% to $77.25 a barrel on ICE Futures Europe. Oil found support after data on Wednesday revealed a drop in U.S. crude inventories to their lowest level since 2018, along with strong refinery demand, as offshore crude production continued to see a slow recovery in the Gulf of Mexico in the wake of Hurricane Ida.



Major currencies were mostly stronger against the US dollar in European and US trade. The Euro rose from lows near US$1.1705 to highs near US$1.1749 and was near US$1.1740 at the US close. The Aussie dollar lifted from lows near US72.39 cents to highs near US73.15 cents and was near US73.00 cents at the US close. But the Japanese yen fell from 109.76 yen per US dollar to near JPY110.31 at the US close.


European Markets

European sharemarkets were mostly higher on Thursday. The pan-European Stoxx 600 index rose by 0.9% with bank stocks up 2.2%. The German Dax index also gained 0.9%, but the UK FTSE index fell by 0.1% after the Bank of England said the case for higher interest rates “appeared to have strengthened” after it lifted its inflation forecasts for the year. In the London trade, shares in Rio Tinto rose by 0.4%, but BHP shares were little changed.


Asian Markets

The Japan Stock Exchange was closed for the holiday. Chinese stocks ended the session higher, as the property sector continued to recover after China Evergrande pulled off plans to pay the coupon on an onshore bond. The benchmark Shanghai Composite Index rose 0.4%, while the Shenzhen Composite Index was up by 0.5%.

The ChiNext Price Index, a measure for emerging industries and startups, rose 0.6%. In addition to recovering developer stocks, renewable energy and utility firms lent further support to the market

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