Friday: 12th January 2018

OPENING CALL: The Australian market looks to open higher with SPI Futures up 17 points.

The Australian share market looks set to open in the green but static, seemingly torn between following a surging US market or Europe’s negative lead.
Wall Street has surged to fresh highs as rising oil prices lifted energy stocks and an upbeat forecast from No. 2 US carrier Delta Air Lines drives airline stocks higher.
Oil prices hit a fresh three-year high intraday ahead of a U.S. decision on whether to extend temporary waivers on sanctions against Iran.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

The Australian share market looks set to open in the green but static, seemingly torn between following a surging US market or Europe’s negative lead.
At 0700 AEDT on Friday, the share price futures index was up 17 points, or 0.28 percent, at 6030.
No major economic or equities news is expected on Friday.
The Australian market on Thursday suffered its second consecutive fall amid widespread selling, while stronger-than-expected retail sales growth lifted the Australian dollar.
The benchmark S&P/ASX200 index fell 29.1 points, or 0.48 percent, to 6,067.6 points.
The broader All Ordinaries index lost 29.7 points, or 0.48 percent, to 6,176.2 points.

US Markets

Wall Street has surged to fresh highs as rising oil prices lifted energy stocks and an upbeat forecast from No. 2 US carrier Delta Air Lines drives airline stocks higher.
Brent crude rose above $US70 a barrel and US crude rose 1.57 percent to $US64.58 per barrel, its highest since December 2014, boosted by a surprise drop in US production and lower crude inventories.
Chevron rose 3.2 percent and Exxon 1.5 percent, helping the S&P energy index gain 2.24 percent and putting it on track for its best percentage gain in more than seven months.
Delta Air Lines rose about 2 percent after reporting an upbeat quarterly profit as well as forecast, helped by higher business fares in a busy holiday season.
That helped the Dow Jones US Airlines index up 2.25 percent.
At 12:20 p.m. ET (1720 GMT), the Dow Jones Industrial Average was up 119.54 points, or 0.47 percent, at 25,488.67 and the S&P 500 was up 10.06 points, or 0.37 percent at 2,758.29.

Commodities

Gold prices edged higher to settle at a four-month high as the U.S. dollar took a turn lower for the week.
February gold tacked on $3.20, or 0.2%, to settle at $1,322.50 an ounce — the highest finish for a most-active contract since Sept. 15, FactSet data showed. The exchange-traded SPDR Gold Shares was up 0.4%.
IRON ORE: $76.06 -0.54(February contract)

Oil Futures

Oil prices hit a fresh three-year high intraday ahead of a U.S. decision on whether to extend temporary waivers on sanctions against Iran.
Light, sweet crude for February delivery rose 97 cents, or 1.5%, to $64.54 a barrel on the New York Mercantile Exchange, on track for the highest close since December 2014.
Brent, the global benchmark, gained 56 cents, or 0.8%, to $69.76 a barrel.

Forex

The U.S. dollar fell intraday after minutes from the European Central Bank’s December meeting signaled the central bank may phase out its bond-buying program sooner than investors had expected.
The Wall Street Journal Dollar Index, which measures the currency against a basket of 16 others, fell 0.4% to 85.46, as the euro strengthened 0.7%.
The minutes showed that officials considered a move “early in the coming year” to further reduce the stimulus, assuming economic growth remains strong. The news caught some investors by surprise because ECB President Mario Draghi gave no indication after the bank’s December meeting that its policy mix might soon change.
Australian Dollar:
The Australian dollar has extended the gain it enjoyed from November’s better-than-expected retail trade figures.
At 0635 AEDT on Friday, the Australian dollar was worth 78.92 US cents, up from 78.74 US cents on Thursday.

European Markets

European shares dipped on Thursday as a bond market sell-off and a stronger euro took the steam out of the breakneck New Year rally in equities.
Results drove the bulk of stock moves, with some disappointments weighing heavily.
The pan-European STOXX 600 and eurozone equities ended the session 0.3 percent lower, extending sharp losses in the previous session when jitters over a report that China was considering slowing purchases of US Treasury bonds spilled over into stocks.
A Chinese regulator on Thursday said the report might be “fake”.
While the STOXX was roughly flat for most of the morning session, the index dipped followed the release of minutes from the European Central Bank’s December meeting showing that the ECB should revisit its policy message in early 2018.
The euro’s rise following the ECB release put pressure on Eurozone indexes with Germany’s DAX closing 0.59 percent lower, at 13,202.90.
Britain’s FTSE 100, meanwhile, touched a fresh record and ended 0.19 percent higher at 7,762.94.

Asian Markets

Asian indexes were pulled lower by warnings from Canada and Mexico that NAFTA’s days could be numbered.
MSCI’s Asia ex-Japan stock index was weaker by 0.25 percent while Japan’s Nikkei index closed down 0.33 percent at 23,710.43.
Hong Kong’s benchmark stock index rose for the 13th consecutive session on Thursday, as strength in financial shares offset losses of 2.5 percent for index heavyweight Tencent Holdings.
The Hang Seng index was up 0.15 percent at 31,120.39. The Hang Seng China Enterprises index rose 0.05 percent to 12,295.52.
China’s main Shanghai Composite index closed up 0.10 percent at 3,425.35 points while
its blue-chip CSI300 index ended down 0.05 percent at 4,205.59.
The S&P/NZX50 Index dropped 1.4 percent, to 8,250.44.

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