IG Markets - Morning Prices September 19

Risk appetite remained subdued through European and US trade, with EUR/USD finally losing its grip on the 1.31 level. AUD/USD came off its lows at around 1.041 and is currently pinned between 1.0440 and 1.0450. Most major equity markets were trading in the red, while periphery spreads to Germany widened. We saw weakness in equities despite some fairly positive economic data. The German ZEW index came in slightly above expectations at -18.2, up from -25.5. Data in the US surprised to the upside with the current account deficit in Q2 narrowing to 3.0% of GDP from 3.5% in Q1, and NAHB housing market index rising to 40 in September. Fed member Evans noted that the unemployment rate will fall below 7% by the end of 2014 due to QE3.

Ahead of the open, we are calling the Aussie market relatively flat at 4397. Once again, the elusive 4400 level will be the key level to look out for. On the local economic front, today we have the MI leading index as well as comments by RBA Assistant Governor Kent on the calendar. Elsewhere in the region, investors will be looking out for the BoJ's policy decision. Nikkei reported that the BoJ initially intended to stand pat until next month but is now set to ’discuss monetary easing‘ on Wednesday as weak foreign demand threatens the domestic economy. The newspaper also noted that the BoJ, if it pursues additional easing, will increase the asset purchases in the coming January to June period and eliminate the minimum bidding yield to buy long-term bonds. USD/JPY has been well bid during the BoJ’s two-day meeting and near-term resistance is at around 79. The policy decision could have a significant bearing on how the Nikkei and the rest of the region trades today.

On a stock level, we expect a mildly firmer start for BHP Billiton, with its ADR suggesting it will be up 0.1% at the open to $34. Fortescue Metals rallied after resuming trade yesterday. The stock has received some broker upgrades since the funding announcement and it will be interesting to see if it enjoys some follow-through buying today. FMG is also on ratings watch at the moment but the new facility removes immediate pressures on its credit profile. David Jones is scheduled to report earnings. In March, DJS said it sees 35% to 40% year-on-year decline in FY12 profit after tax, implying a net income forecast of $100.9m to $109.3m (from $168.1m in FY11).

Market Price at 6:30am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0454 0.0004 0.04%
ASX (cash) 4397 1 0.03%
US DOW (cash) 13574 28 0.20%
US S&P (cash) 1457.1 -1.0 -0.07%
UK FTSE (cash) 5868 2 0.03%
German DAX (cash) 7357 -23 -0.31%
Japan 225 (cash) 9178 54 0.59%
Rio Tinto Plc (London) 31.93 -0.23 -0.71%
BHP Billiton Plc (London) 20.00 -0.25 -1.26%
BHP Billiton Ltd. ADR (US) (AUD) 34.00 0.05 0.14%
US Light Crude Oil (October) 95.84 -0.38 -0.39%
Gold (spot) 1771.2 16.4 0.93%
Aluminium (London) 2151 3 0.15%
Copper (London) 8301 25 0.31%
Nickel (London) 17712 -330 -1.83%
Zinc (London) 2271 28 1.25%

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.
www.igmarkets.com.au

© Scoop Media