Thursday: 12th April 2018

OPENING CALL: The Australian market looks to open lower with SPI Futures down 10 points.

The Australian share market is expected to open slightly lower after US equities lost ground on the back of geopolitical worries and the likelihood of more US interest rate rises than anticipated.

Wall Street stocks have closed lower as possible US military action against Syria stoked investor concerns about geopolitical risk to the American economy and minutes from the most recent US Federal Reserve policy meeting sparked worries about a more hawkish view on interest-rate increases.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

The Australian share market is expected to open slightly lower after US equities lost ground on the back of geopolitical worries and the likelihood of more US interest rate rises than anticipated.
At 0700 AEST on Thursday, the Australian share price futures index was down 10 points, or 0.17per cent, at 5,798.
The Australian share market on Wednesday closed lower despite strong performances from energy and mining companies.
The benchmark S&P/ASX200 was down 28.3 points, or 0.48 per cent, at 5,828.7 points, while the broader All Ordinaries index was down 26 points, or 0.44 per cent, at 5,925.8 points.
In economics news on Thursday, the Australian Bureau of Statistics releases housing finance figures for February.
In equities news, Caltex Australia chief executive Julian Segal speaks at an American Chamber of Commerce lunch in Sydney.

US Markets

Wall Street stocks have closed lower as possible US military action against Syria stoked investor concerns about geopolitical risk to the American economy and minutes from the most recent US Federal Reserve policy meeting sparked worries about a more hawkish view on interest-rate increases.
The decline followed two days of gains, driven by easing concerns about trade tensions between the United States and China.
On Wednesday, US President Donald Trump warned Russia of imminent military action in Syria, declaring missiles “will be coming.”
The rising tensions sent oil prices surging, boosting energy stocks one per cent. But the risk-off sentiment weighed on Treasury yields, pushing financial stocks down 1.3 per cent.
“There’s general nervousness about what might happen with any strikes and the potential escalation of tensions with Russia,” said Anwiti Bahuguna, senior portfolio manager at Columbia Threadneedle Investments in Boston.

Commodities

The spot price of gold in Sydney at 0700 AEST was $US1,353.20 per fine ounce, from 1,344.30 per fine ounce on Wednesday.
IRON ORE: $64.13 -1.56(May contract)

Oil Futures

Oil surged to the highest levels in more than three years as tensions simmered in the Middle East, signaling optimism that a glut that has crippled the market for years is ending.

Forex

The U.S. dollar slipped as a government report showed core inflation met forecasts in March.
The WSJ Dollar Index, which measures the currency against a basket of 16 others, slipped by 0.1% to 83.64.
The dollar remained lower after the Labor Department said Wednesday that the consumer-price index, reflecting what Americans paid for everything from furniture to apparel, fell 0.1% from a month earlier, a drop owed entirely to a temporary decline in gasoline prices.

Australian Dollar:
The Australian dollar is slightly higher against a weaker US dollar that was weighed down by falls in US stocks after President Donald Trump tweeted missile threats against Syria and Russia.
At 0635 AEST on Thursday, the local currency was worth 77.57 US cents, up from 77.45 US cents on Wednesday.

European Markets

Renewed caution among investors dented Britain’s top share index on Wednesday as Western forces discussed possible military action against Syria, although strong results from Tesco pushed its shares higher.
The FTSE 100 was down 0.13 per cent, though it remained near the six-week high it reached on Tuesday after several days of gains.
The pan-European FTSEurofirst 300 index lost 0.60 per cent, Germany’s DAX lost 0.8 per cent and the CAC 40 in France was down 0.6 per cent
The escalation of tensions over a suspected chemical attack in Syria weighed on travel stocks after air traffic control agency Eurocontrol warned airlines to exercise caution in the eastern Mediterranean due to possible air strikes into Syria in the next 72 hours.
Budget airlines easyJet and Ryanair declined 1.8 and three per cent, while cruise operator Carnival dropped 2.1 per cent and Intercontinental Hotel fell 1.6 per cent.

Asian Markets

Asian stocks rose modestly on Wednesday but pared early gains as caution again crept into markets over strained U.S-China trade ties and escalating tensions in Syria.
Chinese President Xi Jinping and US President Donald Trump both struck conciliatory tones on Tuesday, which analysts hoped could open the door for negotiations to avert a trade war. But one report said early talks have already broken down.
MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.04 per cent higher, while Japan’s Nikkei lost 0.49 per cent.
Shanghai shares fared better after China’s central bank set out the clearest timetable yet for opening financial services to foreign investors.
On Wednesday, New Zealand’s S&P/NZX 50 index fell 0.19 per cent, to 8,453.72.

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