Tuesday: 2nd January 2018

OPENING CALL: The Australian market looks to open flat with SPI Futures steady at 6,020.

The Australian share market looks set to open steady on the first day of trading for 2018.
There were no fireworks on Wall Street for the last trading day of the year, as US stocks closed out their best year since 2013 on a down note, with losses in technology and financial stocks keeping equities in negative territory for the session.
A weaker dollar propelled gold prices back above $1,300 on the final trading day of 2017.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

The Australian share market looks set to open steady on the first day of trading for 2018.
At 0700 AEDT on Tuesday, the share price futures index was steady at 6,020.
In economic news on Tuesday, the CoreLogic house prices data for December is expected to be released, as is the Ai Group’s performance of manufacturing index (PMI).
No major equities news is expected, although Australian chocolate maker Yowie Group may give a trading update and come out of a trading halt.
The Australian market closed lower on Friday>, the last trading session for 2017, with almost all sectors in negative territory.
The benchmark S&P/ASX200 index fell 23 points, or 0.38 percent, to 6,065.1 points.
The broader All Ordinaries index lost 22.1 points, or 0.36 percent, to 6,167.3.

US Markets

There were no fireworks on Wall Street for the last trading day of the year, as US stocks closed out their best year since 2013 on a down note, with losses in technology and financial stocks keeping equities in negative territory for the session.
Major indexes hit a series of record highs in 2017, lifted by a combination of strong economic growth, solid corporate earnings, low-interest rates and hopes for a tax cut from US president Donald Trump’s administration.
The benchmark S&P 500 surged 19.5 percent over the past 12 months, the blue-chip Dow 25.2 percent and Nasdaq 28.2 percent, as each of the major Wall Street indexes scored the best yearly performance since 2013.
The market has also remained resilient in the face of tensions in North Korea and political turmoil in Washington. The S&P 500 only saw four sessions all year with a decline of more than 1 percent while the CBOE Volatility index topped out at 15.96 on a closing basis, well below its long-term average of 20.
Among sectors, the technology index has been the best performer, up 37 percent and led by a gain of 87.6 percent in Micron Technology.
Telecom services, down 5.7 percent, and energy, down 3.7 percent, were the only two sectors to end the year in the red.
The rally is widely expected to extend into 2018, boosted by gains from a new law that lowers the tax burden on US corporations.
The Dow Jones Industrial Average fell 0.48 percent, on Friday to close at 24,719.22, the S&P 500 lost 0.52 percent, to 2,673.61 and the Nasdaq Composite dropped 0.67 percent, to 6,903.39.

Commodities

A weaker dollar propelled gold prices back above $1,300 on the final trading day of 2017.
Front-month gold for January delivery added 0.9% to $1,306.30 a troy ounce on the Comex division of the New York Mercantile Exchange — its highest close since September. Prices closed the year with 11 days of gains in the last 12 sessions and up 14% for 2017 — their best year since 2010.
The dollar’s recent weakness has supported gold prices by making the dollar-denominated metal cheaper for overseas buyers.
IRON ORE: $71.75 ++1.04( Febrary contract )

Oil Futures

Oil prices ended the year above $60 a barrel on Friday, a milestone not seen in more than two years, in another sign that a longstanding global glut is easing.
Light, sweet crude for February delivery rose 58 cents, or 1%, to $60.42 a barrel on the New York Mercantile Exchange, the highest settle value since June 2015. Brent, the global benchmark, gained 71 cents, or 1.1%, to $66.87 a barrel.

Forex
The U.S. dollar weakened Friday, clinching its largest yearly percentage drop in a decade.
The Wall Street Journal Dollar Index, which measures the U.S. currency against a basket of 16 others, fell 0.3%. The dollar fell 7.5% for the year, its biggest annual decline since 2007.
Investors have favored the euro versus the dollar throughout much of 2017, as faster-than-expected growth in Europe prompted investors to speculate that officials can tighten monetary policy sooner and faster than had previously been expected. Higher interest rates tend to make a currency more attractive to yield-seeking investors.
The European Central Bank is reducing its monthly bond purchases to EUR30 billion in January from EUR60 billion. The ECB had earlier scaled back its purchases from EUR80 billion in April.

Australian dollar:

The Australian dollar has crept a little higher against its severely weakened US counterpart.
At 0635 AEDT on Tuesday, the Australian dollar was worth 78.09 US cents, up from 78.03 US cents on Friday.
European Markets

In Europe, Britain’s market closed the year with a gain of 7.6 percent.
Indexes in Germany and France finished 2017 with gains of 12.5 percent and 9.3 percent, respectively.
On Friday, the FTSE 100 gained 0.85 percent to 7,687.77 but Frankfurt’s DAX lost 0.48 percent to close at 12,917.64.

Asian Markets
Japan’s Nikkei and Hong Kong’s benchmark index notched gains of 19.1 percent and 36 percent, respectively for the year.
On Friday, the Nikkei lost 0.08 percent to close at 22,764.94, Hong Kong’s key bench market index the Hang Seng rose 0.19 percent to 29,919.15.
In China, the Shanghai Composite on Friday gained 0.33 percent to 3,307.17 while the CSI300 lifted 0.30 per cent to finished the trading year at 3,307.17.
The gains in overseas markets reflect how economies in Japan, Europe, China and many developing nations began growing in tandem with the US for the first time in a decade.
The NZX50 lost 0.12 percent on Thursday, its last trading day, to close at 8,398.08.

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