Thursday 4th April 2019

OPENING CALL: The Australian market looks to open flat.

Australian stocks steadily trended higher amid fresh gains in much of Asia Pacific, pushing the benchmark ASX 200 to seven-month highs as it notched a seven-day winning streak. If the index rises again tomorrow, it would match the eight-session run through Nov. 2.
The S&P 500 inched higher intraday, supported by optimism about trade negotiations and upbeat service-sector economic figures from Europe and China.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

Australian stocks steadily trended higher amid fresh gains in much of Asia Pacific, pushing the benchmark ASX 200 to seven-month highs as it notched a seven-day winning streak. If the index rises again tomorrow, it would match the eight-session run through Nov. 2. The ASX rose 0.7% to 6285.0 as the materials sector jumped 1.7% to fresh seven-and-a-half-year bests amid iron ore’s continued surge. But financials rose just 0.3% and energy fell by that much despite continued oil-price gains.

US Markets

The S&P 500 inched higher intraday, supported by optimism about trade negotiations and upbeat service-sector economic figures from Europe and China. The benchmark equity gauge was recently up 0.1% and on track for a fifth consecutive advance, after earlier climbing as much as 0.6%. The index has rebounded 15% so far this year, climbing to its highest level since early October and pulling within about 2% of last year’s all-time high. The Dow Jones Industrial Average added 24 points, or 0.1%, to 26203. The tech-heavy Nasdaq Composite advanced 0.6%. Progress on U.S.-China trade talks and caution from central banks around the world have eased fears of a far-reaching economic slowdown, supporting stocks and other risky investments. Wednesday’s advance came after the Financial Times reported the U.S. and China have resolved most of the sticking points preventing an agreement to end their months long tariff dispute. The report came ahead of scheduled meetings between both sides in Washington starting Wednesday. Some investors expect an agreement will lift the outlook for the global economy. Materials shares tied to the health of the economy were among the market’s best performers, with the S&P 500 materials sector adding 1.4%. Makers of semiconductors reliant on trade flows and Chinese demand also surged, with shares of Applied Materials, Micron Technology and Advanced Micro Devices each adding more than 3.5%.

Matières premières

Gold futures finished near unchanged levels as reported progress in negotiations between the U.S. and China bolstered appetite for stocks and away\ from bullion, while the U.S. dollar softened. Gold for June delivery on Comex edged 10 cents, or less than 0.1%, lower to settle at $1,295.30 an ounce, while May silver picked up 4.1 cents, or 0.3%, to end at $15.102 an ounce. The yellow metal drifted up after data from payment processor Automatic Data Processing Inc.’s report showed private-sector payrolls rose by 129,000 in March, below average analysts’ estimates polled by FactSet for 165,000 jobs and below last months February reading of 197,000. The data, which investors watch for clues to official jobs data due on Friday, appeared to weigh on the dollar. Meanwhile, gold bulls said that while global bond yields have bounced back this week, their decline so far this year as global central banks turn more dovish should help set a floor for precious metals. In other metals trade, June palladium lost $22.20, or 1.4%, to settle at $1,378.10 an ounce, while July platinum finished $21.70, or 2.5%, higher to $874.20 an ounce. May copper added 4.3 cents, or 1.5, to settle at $2.9485 a pound.

Iron Ore: 88.59s + 2.79 (May Contract)

Oil Futures

Oil prices were slightly lower Wednesday, holding near five-month highs after data showed U.S. crude exports remain strong but domestic oil inventories rose for a second straight week. West Texas Intermediate futures, the U.S. oil benchmark, fell 0.5% to $62.24 a barrel on the New York Mercantile Exchange. Prices closed Tuesday at $62.58 a barrel, the highest closing price since Nov. 5. Brent crude, the global oil benchmark, was down 0.2% at $69.26 a barrel on Prices came under modest selling pressure Wednesday morning after the Energy Information Administration said crude oil inventories in the U.S. rose by 7.2 million barrels to 449.5 million barrels, compared with expectations for a modest decline. The report said oil production in the Lower 48 states rose to 11.7 million barrels a day and that overall U.S. output climbed to a record 12.2 million barrels a day. But counteracting that, U.S. imports of crude remained under 7 million barrels a day, the report also showed, and U.S. oil exports remained high, at 2.7 million barrels a day. Oil prices continue to track developments related to U.S.-China trade negotiations that could have a large impact on global oil demand.

Forex

A raft of better-than-expected European data and optimism that the U.S. and China can forge a trade deal soon helped to buoy assets perceived as risky, while weighing on the U.S. dollar. After trading near a 16-month low on Tuesday, the euro rose toward $1.1250 after stronger-than-expected eurozone purchasing managers index readings, momentarily quelling anxieties of rapidly deteriorating economic expansion in Europe. The euro was last changing hands at $1.1245 compared with $1.1208 late Tuesday. The Financial Times reported late Tuesday that a trade deal between the U.S. and China is all but done. Despite the optimism, stock indexes pared some early session gains with the Dow Jones Industrial Average slipping into negative territory in midafternoon trade, while the S&P 500 and Nasdaq Composite both traded off session highs. The ICE U.S. Dollar Index,, a measure of the greenback versus six of its nearest rivals, fell 0.3% to 97.07. Across the pond, the British pound is attempting to log its third consecutive winning session as fears of a full-blown hard Brexit eased after Prime Minister Theresa May met with Labour leader Jeremy Corbyn in a bid to break the Brexit deadlock. Corbyn said the talks with May were “useful but inconclusive,” but added, “there has not been as much change as I expected.” The pound was last at $1.3162, compared with $1.3131 yesterday. Elsewhere, the Japanese yen was weaker versus the buck with one dollar last buying Yen 111.48.

European Markets

The Stoxx Europe 600 climbed 1%. Investors were monitoring the latest Brexit developments after U.K. Prime Minister Theresa May said she would seek bipartisan talks with the opposition Labour Party to try to break a deadlock on the country’s departure from the European Union.

Asian Markets

In Asia, Japan’s Nikkei 225 gained 1% and Hong Kong’s Hang Seng rallied 1.2%. “Trade talks between China and the U.S. have, for now, produced positive news as a deal has moved closer,” said Carsten Brzeski, chief economist at ING Germany. “We are clearly getting to a point where there is going to be a conclusion of those talks,” said Seema Shah, senior global investment strategist at Principal. “It is fair for the market to expect some kind of resolution.” Indian stocks sold off in the last 90 minutes of trading, preventing a second-straight record closing high for the benchmark Sensex and ending a four-day winning streak. The index closed down 0.5% at 38877.12, just the fifth drop since the start of March. Singapore’s stock benchmark continued their regional strength, logging one of Asia’s biggest gains while rising for a 5th day and setting another 8-month closing high. The Straits Times Index rose 1% to 3311.27, and another advance tomorrow matches early January’s 6-day winning streak.

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