Monday: 23rd April 2018

OPENING CALL: The Australian market looks to open lower with SPI Futures down 15 points.

The Australian share market is expected to open lower, after metals prices, and US and European stocks suffered falls in trading at the end of last week.

Wall Street’s three major indexes declined on Friday as investors worried about a jump in US bond yields, with technology stocks leading the decline on nerves about upcoming earnings reports and iPhone demand.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market
The Australian share market is expected to open lower, after metals prices, and US and European stocks suffered falls in trading at the end of last week.
At 0700 AEST on Monday, the Australian share price futures index was down 15 points, or 0.26 per cent, at 5,833.
 The Australian share market on Friday closed modestly lower, largely due to losses from heavyweight mining stocks.
The benchmark S&P/ASX200 was down 12.2 points, or 0.21 per cent, at 5,868.8 points, while the broader All Ordinaries index was down 12 points, or 0.2 per cent, at 5,964.4 points,
In economics news on Monday, CoreLogic releases its weekly capital city.
In equities news, property group Mirvac issues its quarterly update.
US Markets
Wall Street’s three major indexes declined on Friday as investors worried about a jump in US bond yields, with technology stocks leading the decline on nerves about upcoming earnings reports and iPhone demand.
The technology index was the biggest drag on the S&P 500 with a 1.5 per cent drop after registering three straight days of losses ahead of a key earnings week for the sector.
“It’s not that earnings weren’t good enough but company forecasts often weren’t strong enough to make the market continue to rise,” said Rick Meckler, president of investment firm LibertyView Capital Management in Jersey City, New Jersey.
The Dow Jones Industrial Average fell 201.95 points, or 0.82 per cent, to 24,462.94, the S&P 500 lost 22.99 points, or 0.85 per cent, to 2,670.14 and the Nasdaq Composite dropped 91.93 points, or 1.27 per cent, to 7,146.13.
Equity investors were jittery as the 10-year Treasury yield reached its highest level since January 2014 as a bond selloff continued for a second day, driving the yield curve steeper after two weeks of flattening.
Commodities
The spot price of gold in Sydney at 0700 AEST was $US1,335.40 per fine ounce, from $US1,344.50 per fine ounce on Friday.
IRON ORE: $67.07 -1.18 (May contract)
Oil Futures
Oil prices closed little changed Friday, pulled between comments from President Donald Trump that high crude prices “will not be accepted” and a meeting between major oil producers where they recommitted to limiting output.
Forex
The dollar rose to its highest level since January on Friday, driven by expectations of a more aggressive Federal Reserve.
The WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, was up 0.5% at 84.36 late Friday afternoon, its highest level since Jan. 9.
Federal Reserve Bank of Cleveland President Loretta Mester said Thursday that steady interest-rate rises are needed to keep the economy humming along, in remarks that cautioned against deliberating overheating the economy in a bid to help boost employment.

Australian Dollar:

The Australian dollar is lower, after Wall Street fell, dragged down by falls in technology stocks on nerves about upcoming earnings reports.
At 0635 AEST on Monday, the local currency was worth 76.74 US cents, down from 77.09 US cents on Friday.
European Markets
A weaker sterling helped Britain’s FTSE 100 outperform European markets on Friday, while consumer giant Reckitt Benckiser tumbled after disappointing results and Shire declined as Allergan pulled out of the running to acquire the company.
The leading UK stock index closed up 0.54 per cent at 7368.17 points, posting a fourth straight week of gains with a 1.4 per cent rise, its longest winning streak since mid-January.
On the European mainland, Germany’s DAX index fell 0.21 per cent, and France’s CAC 40 ended 0.39 per cent higher.
Sterling fell after Bank of England Governor Mark Carney dampened widespread expectations for an interest rate hike in May.
Earnings continued to set the tone for trading.
Reckitt Benckiser shares fell 2.8 per cent after the maker of Dettol products reported that sales growth had missed expectations, including sluggish results at its Scholl footcare brand.
Asian Markets
Asian shares slipped on Friday as a warning on smartphone demand from the world’s largest contract chipmaker slugged the tech sector, while high oil prices stirred inflation fears and undermined sovereign bonds.
In Asia, Apple led the way after Taiwan Semiconductor Manufacturing cut its revenue target to the low end of forecasts and blamed softer demand for smartphones.
“The big story for the APAC region today will be fallout from TSMC’s miss, which will weigh heavily on the tech sector, with first order impacts on the Semis and Samsung Electronics/ Galaxy supply chain,” analysts at JPMorgan said in a note.
MSCI’s broadest index of Asia-Pacific shares outside Japan shed 1.1 per cent, again led by a 1.6 per cent fall in technology.
Japan’s Nikkei eased 0.1 per cent as the drop is tech outweight the gains in energy and financials.
On Friday, New Zealand’s S&P/NZX 50 index fell 0.59 per cent, to 8,323.22.

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