IG Markets - Morning thoughts and opening prices 5/3/12

In US trade, markets retreated despite further evidence of an economic recovery. Risk appetite was generally lower in profit taking over concerns about Spain’s budget proposition.

Among the major averages, the Dow Jones Industrial Average was flat at 12978. The S&P was 0.3% lower at 1370, and the NASDAQ declined 0.4% to finish at 2976. US markets continue to struggle at key levels and as a result, we are likely to continue to see markets in a holding pattern until the next catalyst.

Spain’s budget proposition resulted in renewed euro-scepticism as it undermined the credibility of the EU and its agreements on rescue packages for Greece and other eurozone nations. This saw money flow out of risk currencies and into the US dollar. The stronger US dollar weighed on commodity and equity prices. As a result, we are likely to see weakness in the resource space at the open. New lending at China’s four biggest banks reportedly rose by about $3.2 billion in the first two months of 2012 from a year earlier. This might give some upside to risk assets this morning.

Ahead of the open, we are calling the Aussie market down 0.4% at 4258. However, this is based on Saturday morning’s close for futures, and therefore we will only get a more accurate read once futures re-open. Risk currencies have opened relatively flat this morning from Saturday’s close. On the economic front, we have ANZ job ads, MI inflation gauge and company operating profits data due out this morning.

IG Markets provides round-the-clock CFD trading on currencies, indices and commodities. The levels quoted in this email are the latest tradeable price for each market. The net change for each market is referenced from the corresponding tradeable level at yesterday’s close of the ASX. These levels are specifically tailored for the Australian trader and take into account the 24hr nature of global markets.

Please contact IG Markets if you require market commentary or the latest dealing price.

ENDS

© Scoop Media