Wednesday: 21st March 2018

OPENING CALL: The Australian market looks to open higher with SPI Futures down 7 points.

 The Australian share market is expected to open slightly higher after a strong surge in oil prices gave energy stocks and the major US stocks indexes a boost.

 US stocks have closed as higher oil prices buoyed the energy sector, but another slump in Facebook Inc shares curbed gains.

Oil prices climbed more than 2% to three-week highs as Crown Prince Mohammed bin Salman’s visit to Washington raised the prospect of a more aggressive stance toward Iran.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

The Australian share market is expected to open slightly higher after a strong surge in oil prices gave energy stocks and the major US stocks indexes a boost.
At 0700 AEDT on Wednesday, the Australian share price futures index was up seven points, or 0.12 per cent, at 5,930.
The Australian share market on Tuesday closed lower following soft leads from other markets and a fall in iron ore prices..
The benchmark S&P/ASX200 was down 23 points, or 0.39 per cent, at 5,936.4 points, while the broader All Ordinaries index was down 23.9 points, or 0.39 per cent, at 6,040.8 points.
In equities news on Wednesday, troubled department store chain Myer, and Agricultural chemicals supplier Nufarm both release their half year results.

US Markets

US stocks have closed as higher oil prices buoyed the energy sector, but another slump in Facebook Inc shares curbed gains.
Oil prices rose more than two per cent to touch a three-week high, driven by tensions in the Middle East and the possibility of further declines in Venezuelan crude output.
Those gains helped the S&P energy index up 0.95 per cent, making it easily the best performing of the 11 major S&P 500 sectors.
Facebook Inc shares were down 4.2 per cent. The social media company said on Tuesday it faced questions from the US Federal Trade Commission about how its users’ personal data was mined by a political consultancy hired by President Donald Trump’s campaign.
The stock has fallen about 12 per cent over the past two session, on track for its biggest two-day decline since July 2012 in a drop that has weighed heavily on equities.
US and European lawmakers have demanded an explanation of how the consultancy gained access to the data and why Facebook failed to inform its users, raising broader industry questions about consumer privacy and whether heavier regulation is on the horizon.
The Dow Jones Industrial Average closed 116.36 points, or 0.47 per cent higher, at 24,727.27, the S&P 500 gained 4.02 points, or 0.15 per cent, to 2,716.94 and the Nasdaq Composite added 20.06 points, or 0.27 per cent, to 7,364.30.

Commodities

Gold futures gave back all of the previous day’s gains and then some, marking their lowest finish in nearly three weeks, as the dollar strengthened ahead of a widely expected interest-rate hike by the Federal Reserve.
IRON ORE: $65.90 +0.01 (April contract)

Oil Futures

Oil prices climbed more than 2% to three-week highs as Crown Prince Mohammed bin Salman’s visit to Washington raised the prospect of a more aggressive stance toward Iran.

Forex

The dollar edged higher intraday, a day before the conclusion of the Federal Reserve’s monetary policy meeting.
The Wall Street Journal Dollar Index, which measures the U.S. currency against a basket of 16 others, was recently up 0.3% at 84.10.
Market participants expect the Fed to announce its first interest rate increase of 2018 at the conclusion of its meeting on Wednesday. Many will also be looking for signs that the central bank may tighten monetary policy at a faster clip later this year to prevent the economy from running too hot.
Expectations of rising rates tend to boost the dollar, as higher borrowing costs make the currency more attractive to yield-seeking investors.
Australian Dollar:
The Australian dollar is back below 77 US cents, under pressure from falling metals prices, amid market caution about higher US interest rates and worries about a possible trade war.
At 0635 AEDT on Wednesday, the local currency was worth 76.84 US cents, down from 77.06 US cents on Tuesday.

European Markets

Britain’s FTSE 100 index gained on Tuesday, with banks leading the way after data showed a small slowdown in inflation, while Fenner shares surged after a takeover offer from tyre maker Michelin.
In the second approach for a UK mid-cap firm in as many days, Fenner jumped 24 per cent to the top of the FTSE 250 after France’s Michelin made a 1.2 billion-pound ($A2.2 billion) bid for the engineering company.
The FTSE 100 was up 0.3 per cent at the close, with house builders Taylor Wimpey, Berkeley Group and Persimmon among the biggest gainers. Bellway jumped 3.5 per cent.
On the mainland, Germany’s DAX 30 index was up 0.74 per cent, and the French stockmarket was up 0.57 per cent.

Asian Markets

Asian shares were on the defensive on Tuesday after investors took profits in high-flying US technology shares on fears of stiffer regulation, as Facebook came under fire following reports it allowed improper access to user data.
The retreat came as investors braced for new Federal Reserve Chairman Jerome Powell’s first policy meeting starting later in the day and amid concerns that US President Donald Trump could impose additional punitive trade measures against China.
MSCI’s broadest index of Asia-Pacific shares outside Japan were last up 0.2 per cent after initially dropping as much as 0.5 per cent. Japan’s Nikkei fell 0.5 per cent.
The S&P/NZX 50 index on Tuesday fell 0.06 per cent, to 8,487.15.

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