Markets are down overnight over Asian uncertainty

Markets are down overnight over Asian uncertainty

By Chay Flack (Equities Dealer, CMC Markets Stockbroking)

Markets are down overnight over Asian uncertainty. A Bloomberg report yesterday announced “China’s biggest banks tripled the amount of bad loans written off in the first half, cleaning up their books ahead of what may be a fresh wave of defaults”. This was the catalyst for the pull-back in our market and would have had influence internationally, as the memory of toxic loan books from the GFC is a sore point for many investors.

The Dow Jones is off 54.33 points, partly influenced by downgraded earnings forecasts for Caterpillar and Broadcom that has triggered profit taking, capping a five-day winning streak.

The Australian market has had a very good week as investors are seeing positive momentum and are gaining more confidence to enter the market. Switching from CBA to the other banks is starting to happen and is likely to be a continual theme as investors position to receive November dividends.

Yesterday’s fall of 26 points should have priced in the overnight move, however it’s likely we will see an initial fall in our market this morning as investors will sit back and watch today. The futures finished up four points

We have Chinese Manufacturing PMI numbers released today and US new home sales coming overnight.

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