Wednesday: 13th December 2017

OPENING CALL: The Australian market looks to open higher with SPI Futures down 1 point.

The Australian share market looks set to open higher amid continuing positive sentiment and after better-than-expected produce price index figures boost Wall Street’s Dow and S&P500 indexes.
Shares of banks and other financial firms surged intraday, putting the Dow Jones Industrial Average and the S&P 500 on track to notch another set of record closes.

Overnight Summary

Each Market In Focus

Australian Market

The Australian share market looks set to open higher amid continuing positive sentiment and after better-than-expected produce price index figures boost Wall Street’s Dow and S&P500 indexes.
At 0700 AEDT on Wednesday, the share price futures index was down 1 point, or 0.02 percent, at 6,017.
In economic news on Wednesday, Reserve Bank of Australia governor Philip Lowe is slated to speak at the Australian Payment Summit in Sydney, along with RBA Head of Payments Policy Tony Richards.
RBA Assistant Governor (Financial Markets) Chris Kent is expected to speak on the topic of The Availability of Business Finance at the 30th Australasian Finance and Banking Conference, also in Sydney.
No major equities news is expected on Wednesday.
The Australian market on Tuesday closed higher buoyed by strength in the heavyweight energy and mining sectors.
The benchmark S&P/ASX200 index rose 14.9 points, or 0.25 percent, to 6,013.2 points.
The broader All Ordinaries index gained 11.2 points, or 0.18 percent, to 6,093.1 points.

US Markets
Wall Street stocks are higher in afternoon trade with the biggest boost from the financial sectors as investors bet on strong economic growth a day ahead of the US Federal Reserve’s widely-expected rise in interest rates.
Earlier in the day, a Labor Department report showed US producer prices rose in November as petrol prices surged and the cost of other goods increased, leading to the largest annual gain in nearly six years and pointing to a broad acceleration in wholesale inflation pressures.
The Dow Jones Industrial Average was up 0.59 percent, to 24,529.63
The S&P 500 had gained 0.33 percent, to 2,668.67.
The Nasdaq Composite had dropped 0.09 percent, to 6,869.20.

 

Commodities

Gold prices fell for a fourth-straight session with the Federal Reserve beginning its final meeting of the year.
Gold for February delivery declined 0.4% to $1,241.70 a troy ounce on the Comex division of the New York Mercantile Exchange. Prices have fallen to their lowest level since July recently, weighed down by a rebounding dollar and investor concerns over higher interest rates.
IRON ORE: $68.01 +0.23 ( January contract )

Oil Futures

Global oil prices wavered between gains and losses intraday as traders weighed the impacts of the shutdown of a key European pipeline.
Light, sweet crude for January delivery was recently down 30 cents, or 0.5%, at $57.69 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell 30 cents, or 0.5%, to $64.39 a barrel.

Forex
The U.S. dollar strengthened intraday on the back of strengthening producer-price inflation data, with the buck’s direction aligned with gains for select rival currencies supported by their own stronger-than-expected inflation readings.
The ICE U.S. Dollar Index rose 0.4% to 94.194, and the broader WSJ U.S. Dollar Index also turned positive, rising 0.2% to 87.47.
The greenback fell to a four-day low against the Swedish krona, which outperformed other G-10 currencies early on in the session, supported by upbeat inflation figures. The krona managed to defend its gains despite the strengthening buck, and one dollar last bought 8.4471 krona, down from 8.5029 krona late Monday in New York.
The Japanese yen also strengthened in earlier trading, but with the dollar gaining momentum, the yen relinquished its gains and one dollar bought Y113.64, compared with Monday’s Y113.56 level.

Australian Dollar:

The Australian dollar is higher against its US counterpart which itself has risen following strong economic data.
At 0635 AEDT on Wednesday, the Australian dollar was worth 75.57 US cents, up from 75.36 US cents on Tuesday.

European Markets
Mergers and acquisitions helped boost European stocks on Tuesday, while strength in oil stocks after a pipeline shutdown helped lift a key regional benchmark index to five-week highs.
The pan-European STOXX 600 index up 0.66 percent, its highest level since November 9, while euro zone blue chip stocks rose 0.4 percent, helped by a late drop in the euro.
The earlier jump in oil prices above $US65 a barrel also boosted energy-heavy European stock indexes, with the STOXX 600’s oil and gas sector jumping 1.56 percent.
Germany’s DAX gained 0.46 percent, to 13,183.53
UK shares rose to their highest in a month as rising oil prices boosted energy stocks and the pound retreated, even though British UK inflation rose to its highest in six years.
Asian Markets

Asian shares took a small step back on Tuesday after three straight sessions of gains, with markets consolidating in the hope an upswing in global growth could outlast a likely rise in US borrowing costs this week.
MSCI’s Asia ex-Japan stock index was down 0.33 percent while Japan’s Nikkei index lost 0.32 percent to 22,866.17.
Hong Kong stocks dropped, as index heavyweight Tencent slumped more than 3 percent, and declines in other technology shares also weighed on sentiment.
The Hang Seng index fell 0.59 percent to 28,793.88. China’s main Shanghai Composite index closed down 1.25 percent at 3,280.81 points while its blue-chip CSI300 index ended down 1.31 percent at 4,016.02.
The S&P/NZX50 Index edged up 0.04 percent, to 8,280.81.

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