Monday: 12th March 2018

OPENING CALL: The Australian market looks to open higher with SPI Futures up 57 points.

Australian stocks are expected to open stronger after US President Donald Trump promised Australia would be exempt from its planned tariffs on steel and aluminium.
All three major US stock indexes climbed almost two per cent on Friday and the Nasdaq closed at a record high, as February’s jobs report eased fears of inflation and aggressive interest rate hikes.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

Australian stocks are expected to open stronger after US President Donald Trump promised Australia would be exempt from its planned tariffs on steel and aluminium.
On Monday morning, the Australian share price futures index was up 57 points, or 0.96 per cent, at 6,020.
The Australian share market on Friday closed higher on the back of the US tariffs announcement, and possible exemptions for some countries.
The benchmark S&P/ASX200 was up 20.3 points, or 0.34 per cent, at 5,963.2 points, while the broader All Ordinaries index was up 22.5 points, or 0.37 per cent, at 6,069.1 points.
In economic news on Monday, CoreLogic will release its weekly capital city home prices report.

US Markets

All three major US stock indexes climbed almost two per cent on Friday and the Nasdaq closed at a record high, as February’s jobs report eased fears of inflation and aggressive interest rate hikes.
A month ago, the market had been spooked by wage growth that fuelled inflation fears, leading to a spike in volatility and a stock market correction. That sentiment has reversed over recent weeks with the market gradually nudging higher.
The bull market, which began on March 9, 2009, is the second longest on record, leading to questions about how much longer it can last.
Along with the jobs data, stocks were supported by easing fears of trade wars and signs of a thaw in nuclear tensions with North Korea after US President Donald Trump said he was prepared to meet the country’s leader.
The Dow Jones Industrial Average rose 440.53 points, or 1.77 per cent, to end at 25,335.74, the S&P 500 gained 47.6 points, or 1.74 per cent, to 2,786.57 and the Nasdaq Composite added 132.86 points, or 1.79 per cent, to 7,560.81.

Commodities

Gold prices swung between small gains and losses before closing higher Friday after the February jobs report showed U.S. employers hired workers at the strongest pace in a year and a half, but the pace of wage growth eased.
Front-month gold for March delivery inched up 0.2% to $1,322.40 a troy ounce on the Comex division of the New York Mercantile Exchange. Prices finished the week up 0.1%, swinging based on moves in the dollar and investor expectations for higher interest rates.
IRON ORE: $69.10 -0.93(April contract)

Oil Futures

Oil prices gained on Friday, lifted by positive economic data, rising stocks and declining U.S. production.
Light, sweet crude for April delivery advanced $1.92, or 3.2%, to $62.04 a barrel on the New York Mercantile Exchange, its biggest one-day percentage gain since July. Brent, the global benchmark, rose $1.88, or 3%, to $65.49 a barrel.

Forex

The dollar edged lower Friday, as investors looked past big job gains in February’s U.S. employment report to focus on anemic wage growth.
The WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, was recently down less than 0.1% at 83.84. The measure climbed, then dipped, after jobs data was released Friday morning.
Nonfarm payrolls rose a seasonally adjusted 313,000 last month, stronger than the 205,000 jobs economists were forecasting. While a tighter labor market should produce faster wage growth, wages grew at 2.6% in February. The annual wage gain in January was revised down to 2.8% increase.

Australian Dollar:
The Australian dollar is higher after the release of strong US jobs figures and the news that there will be a summit between the leaders of the US and North Korea.
At 0635 AEDT on Monday, the local currency was worth 78.53 US cents, up from 77.95 US cents on Friday.

European Markets

UK shares finished at a one-week high, joining in a broader equity rally following supportive US jobs data which calmed investor nerves over tighter monetary policy.
The country’s blue chip FTSE benchmark index ended the session 0.3 per cent higher at 7,224.51 points, while mid-caps gained 0.6 per cent as investors digested a number of earnings updates.
US job growth recorded its biggest increase in more than one-and-a-half years in February, but a slowdown in wage gains pointed to only a gradual increase in inflation this year, which dampened the possibility of the Federal Reserve increasing rates faster.
In Germany the DAX was down 0.07 per cent, and the French stock markets was 0.39 per cent higher.

Asian Markets

Asian shares pared sharp early gains on Friday ahead of US payrolls data which could hasten Federal Reserve rate hikes, and as some caution set in about the new entente between North Korean leader Kim Jong Un and US President Donald Trump.
Kim has committed to “denuclearisation” and offered to hold the first-ever US-North Korea summit, marking a potentially dramatic breakthrough in the North Korea nuclear standoff.
Japan’s Nikkei was 0.47 per cent firmer, having been up more than two per cent at one stage. South Korean stocks eased too but were still one per cent higher.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.6 per cent.
The S&P/NZX 50 index on Friday rose 0.37 per cent, to 8,390.01.

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