Friday: 18th May 2018

OPENING CALL: The Australian market looks to open higher with SPI Futures up 14 points.

The Australian share market is expected to start the day slightly higher despite, Wall Street suffering falls on the back renewed concerns about US-China trade tensions.

Wall Street turned negative in indecisive trade on Thursday, giving up earlier gains as investors grappled with renewed trade worries and rising oil prices.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

The Australian share market is expected to start the day slightly higher despite, Wall Street suffering falls on the back renewed concerns about US-China trade tensions.
At 0700 AEST on Friday, the Australian share price futures index was up 14 points, or 0.23 per cent, at 6,122 points.
The Australian share market on Thursday closed lower as Westpac traded ex-divided, and the industrial and healthcare sectors lost ground.
The benchmark S&P/ASX200 was down 12.7 points, or 0.21 per cent, at 6,094.3 points, while the broader All Ordinaries index was down 10.9 points, or 0.18 per cent, at 6,197.2 points.
In equities news on Friday, funeral and crematorium giant InvoCare holds its annual general meeting in Sydney.
On Friday morning the Australian dollar is lower after Wall Street fell in offshore trade.

US Markets

Wall Street turned negative in indecisive trade on Thursday, giving up earlier gains as investors grappled with renewed trade worries and rising oil prices.
Comments by US President Donald Trump that China “has become very spoiled on trade” added fuel to investor jitters as a second round of talks was launched today in efforts to avoid a tariff war between the world’s two largest economies.
Unrest in the Middle East suggested a reduction of oil supply and sent crude prices to their highest level in three-and-a-half years. The S&P Energy index was up 1.2 per cent, the largest gainer of the major S&P 500 sectors.
Trade and oil price concerns have also benefited smaller firms, according to Gause. “I think that they’re in a better place,” he said. “Global companies are more susceptible to that. Plus they’re more susceptible to increased energy prices, typically.”
The Dow Jones Industrial Average closed 54.95 points, or 0.22 per cent lower, at 24,713.98, the S&P 500 lost 2.33 points, or 0.01 per cent, to 2,720.13 and the Nasdaq Composite dropped 15.82 points, or 0.21 per cent, to 7,382.47.

Commodities

Gold prices hit a new 2018 low Thursday, hurt by a strengthening dollar.
IRON ORE: $67.68 -0.05 (June contract)

Oil Futures

Brent crude prices pared gains to settle near unchanged after hitting $80 a barrel Thursday, as Washington’s decision to reinstate sanctions on Iran continued to fuel a rally that has pushed the market to 3 1/2-year highs.

Forex

A closely followed U.S. dollar index registered further gains Thursday, hovering around a 2018 peak, as its most influential component, the euro, remained soft on local geopolitical headwinds and as the key government bond yield remained at a seven-year high.
The ICE U.S. Dollar Index was up 0.1% at 93.436, holding around its highest levels of the year. The index has been on a seemingly relentless romp higher since mid-April, even though it has had a few intermittent stumbles recently.
The WSJ Dollar Index, a broader measure of the greenback tracking 16 rival monetary units, was up 0.2% to 87.02.
The Australian dollar is slightly lower after US stock ground as investors worry over as possible escalation of US-China trade tensions..
At 0635 AEST on Friday, the local currency was worth 75.11 US cents, from 75.34 US cents on Thursday.

European Markets

Strong oil prices helped Britain’s top share index seal its highest ever closing level on Thursday while online grocery retailer Ocado rocketed up 44 per cent after signing a deal with US grocer Kroger.
The FTSE 100 climbed 0.7 per cent to close at 7,787.97 points, just a whisker away from its record intraday high of 7,792.56 points hit in mid-January.
On the European mainland, Germany’s DAX 30 finished 0.91 per cent higher, while France’s CAC40 was up 0.98 per cent.
The mid-cap FTSE 250 index hit a new record high, surpassing its previous mid-January record, up 0.9 per cent on the day. For both indices it marked a full recovery from the turmoil which had dented markets globally since January.
The star of the session was Ocado, whose shares shot up as much as 81 per cent in intra-day trading before closing up 44 per cent after it announced that US retailer Kroger would use its technology.

Asian Markets

Asian shares edged higher on Thursday while the euro gained some respite after hitting five-month lows a day earlier.
The common currency slumped on Wednesday following a report that Italian populist parties trying to form a coalition government could ask the European Central Bank to forgive 250 billion euros of Italian debt.
In equity markets, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1 per cent, while Japan’s Nikkei gained 0.5 per cent.
The gains in Asian shares came after US equities advanced on Wednesday, led by retail and technology shares, even as a rise in US 10-year Treasury yields to an almost seven-year high suggested more competition for equities.
“In general, Asian equities are buffered from rising US yields by the constructive tone of the US-China trade talks as well as strong earnings numbers,” said Heng Koon How, head of markets strategy for UOB in Singapore.
On Thursday, New Zealand’s S&P/NZX 50 index rose 0.56 per cent, to 8,603.38.

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