Australian market expected to open higher 20/01/20

Australian market expected to open higher 20/01/20

 

OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract expected to open up 36 points.

 

China emerged from 2019 with an official economic growth of 6.1%, within the government’s target but the lowest level in nearly three decades, as trade, investment, consumer spending and business confidence all face pressure.  

 

A judge reduced the amount of punitive damages Johnson & Johnson must pay in a lawsuit over its antipsychotic Risperdal to $6.8 million from the $8 billion awarded by a jury in October.  

 

Overnight Summary

 

 

Each Market in Focus

 

The Australian share market finished 0.3% higher Friday at 7064.1 for its fourth-straight record-high close.  

Materials and consumer staples led gains as the S&P/ASX 200 followed a strong lead from the U.S., where all three major indices closed at records.  

Anglo-Australian mining giant Rio Tinto rose 1.8% to A$105.24 and rival BHP rose 1.2% to A$40.60. Fruit and vegetable producer Costa Group led consumer staple gains with a 4.7% rise to A$2.70 as much-needed rain continued to fall on Australia’s long-burning
bushfires.  After a 2.0% weekly gain, the ASX 200 benchmark is up 5.7% in 2020.  

The S&P 500 rose 12.81 points, or 0.4%, to 3329.62 on Friday, its sixth record close of the year. The Nasdaq Composite advanced 31.81 points, or 0.3%, to 9388.94. The Dow Jones Industrial Average rose 50.46 points, or 0.2%, to 29348.10.  

All three indexes finished the week at least 1.8% higher at new records. Highflying technology stocks were among the biggest gainers of the week, rising almost 3% in the S&P 500.  

State Street ‘s stock gained $1.42, or 1.8% to $82.56 Friday as the trust bank’s profit beat Wall Street’s expectations. That report followed strong numbers earlier in the week from JPMorgan Chase and Morgan Stanley , among other banks.  

Shares of Comcast jumped 63 cents, or 1.3%, to $47.50 after it unveiled its new streaming platform. Investors will be analyzing more earnings results next week.  

 

Gold futures moved higher, but the yellow metal barely budged for the week as stock rallied to all-time highs, helping to undercut some demand for assets perceived as havens.  

Gold for February delivery on Comex gained $9.80, or 0.6%, to settle at $1,560.30 an ounce. March silver, meanwhile, picked up 13.4 cents, or about 0.8%, at $18.073 an ounce.

U.S. oil prices ended virtually unchanged, rising a marginal 2 cents, or 0.03% to close at $58.54/bbl.  

The euro weakened 0.4% against the U.S. dollar to $1.1093 on solid economic data.  

The dollar gained 0.5% against the pound and the WSJ Dollar Index rises 0.2%. Forex traders will be watching the Bank of Canada and the ECB’s policy statements next week.  

 
European stocks rose as largely positive Chinese economic data boosts mining shares and a weaker pound lifted dollar earners on the FTSE 100. The pan-European Stoxx 600 rose 0.9% to 424.56 points, the FTSE 100 gained 0.9% to 7,674.56, the DAX was up 0.7% to 13,526.13 and the CAC-40 increased 1.0% to 6,100.72.  

China’s economy grew at its weakest rate in 29 years in 2019 but a pick-up in December growth raised hopes that a recovery is underway on easing U.S.-China trade tensions.  

Meanwhile, data on Chinese industrial production, fixed asset investment and retail sales were better than forecast. In the U.K., retail sales fell unexpectedly in December, sending the pound lower.  

Hong Kong stocks ended the session higher, with the benchmark Hang Seng Index breaking a key resistance level of 29000 after China’s GDP growth held steady in 4Q, growing 6.0% on year.

The Hang Seng Index rose 0.6% to 29056.42. Drug makers provided the most support, with CSPC Pharmaceutical surging 5.1% and Sino Biopharm rising 3.5%. Financial stocks also came up amid prospects of further loosening measures by Beijing. Ping An Insurance gained 4.3% and BOC Hong Kong added 2.1%.  

Japanese stocks ended higher, driven by gains in auto stocks. Subaru rose 4.3% and auto-parts maker Aisin Seiki gained 3.3%. The Nikkei Stock Average ended 0.5% higher at 24041.26. The earnings season which begins next week will be closely monitored.  

Indian stocks ended the session on a flat note amid mixed trading across most sectors. The benchmark Sensex added 12.81 points to close at 41945.37. Telecom carriers were among the major gainers with Bharti Airtel rising 5.5% and Reliance, which operates a telco
business, advancing 2.8%. The two could actually benefit from the Indian Supreme Court’s dismissal of telco firms’ appeal against paying hefty government charges.  


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