Global political economy in focus: International diplomacy, politics and global trade are at centre of attention to begin the new week. Indeed, that’s in part due to the corporate and economic calendar appearing relatively lighter, being the final week of the month; as well as the fact the UK and US are off on public holidays on Monday. But even in the absence of other hard-hitting, high impact news, the confluence of politics-related headlines merits attention in their own right. And it spans t
Amazon's net income for its first quarter more than doubled to $3.6bn, or $7.09 a share, from $1.6bn in the same quarter last year, beating analysts' expectations of $4.72 a share. Revenue rose 17%, in line with consensus estimates, although it was the lowest YoY growth rate since the beginning of 2015. Operating expenses increased by 13%, down from 41% growth in the same quarter of 2018. Amazon plans to roll out one-day shipping worldwide for its Prime members this year, which will likely driv
Written by Kyle Rodda - IG Australia
A loaded menu: If this week in financial markets is a buffet of information, then yesterday’s session tasted like the entrée. The themes that were predicted to define this week’s trade all showed-up in one form or another, hinting at bigger things to come. US President Trump added heat to the trade war, then spiced up the Brexit debate; a speech from US Federal Reserve Vice President Richard Clarida had traders questioning how many Fed hike’s markets hav
It’s Okay, This One is On the Fed
There has been a notable shift in the market’s mood in just the past week. A sense of dull complacency that traders who were active during the first wave of the large scale, central bank stimulus infusions would recognize has bolstered key assets. After the benchmark S&P 500 and Dow topped at the beginning of May, a steady slide in the indices encouraged the same sinking feeling in conviction that was dependent on complacency. Evidence that we are the
Not with a bang, but with a whimper? Without all the fire and fury that we saw in December, markets are pricing in once again a slow down in global economic growth. It could be strongly argued this is evidence of how important US Fed support is to equity market strength – but that’s a drum to beaten (over-and-over-again) for another day. Fundamentally, traders are quietly re-pricing for a world where economic growth will be weaker than once thought. Such behaviour has been long evident in Chines
Gold prices edged higher after falling on Wednesday. Globally declining treasury yields could increase demand for the yellow-metal if a stock rout were to take place. Spot contracts hit $1311.54 at 6:00am GMT on the IG Web Trading Platform.
Palladium slumped 6% on Wednesday on concerns of slowing demand from the automotive and electronic appliances sectors. Slowing global growth could drown the metal, which hit a record $1620.52 last week.
Oil slumped on Wednesday on reports that
The US and China have agreed a temporary ceasefire on additional tariffs on each others goods at the G-20 summit in Argentina to allow for trade talks to continue in the new year.
Dow futures soared more than 450 points as investors have reacted positively to the US-China news. Nasdaq futures also rose around 2.7%, followed by S&P 500 futures which jumped 1.7%.
The dollar depreciated on Monday as investors looked to take up positions in riskier assets, such as the Australian do
The Dow will open lower today than its open price for the year following weak jobs data and the resulting sell-off of FAANG companies.
US Non-farm payrolls grew by 155,000 on Friday, missing estimates of 198,000 whilst unemployment is near record lows at 3.7%
Chinese markets had a poor start to the week following missed trade estimates for November. The Hang Seng has fallen 1.41%, the Shanghai composite by 0.84% and the Shenzhen composite by 1.15%
The European Court of Justi
Written by Kyle Rodda - IG Australia
Risk? No, thanks: Markets have given a resounding “nope” to all varieties of risk overnight. Equities have been slogged on Wall Street, following to a sluggish day in European markets, that saw the FTSE drop 0.2 per cent and the DAX shed 0.85 per cent. Here it looks like this is the convergence punters have been calling: US shares are playing a rapid catch-up with their global counterparts. The losses are piling up. The NASDAQ has been hit the worst in t
Earnings solid coming from the US continues to push futures up overnight.
Oil prices held steady, supported by a report of rising U.S. crude inventories as well as the introduction of sanctions against Iran.
Elon Musk tweeted last night regarding taking Tesla private. Stock up as he quoted a $420 price target.
Crypto markets slump following SEC bitcoin ETF delay.
Today there’s a 39.1 point FTSE div (updated from 39.0 on the dividend adjustment post) and a 25.8 Dow div
Another ‘Brexit Breakthrough’ Falls Apart
Yet another potential breakthrough in the Brexit stalemate seemed to be hashed out at the beginning of this past week following hours of legal negotiation and closed doors discussions. Supposedly, a draft bill was worked out that both the Prime Minister and top European Union negotiators were comfortable moving forward with. If there were only two parties which needed to be satisfied in this divorce, that would be that. However, there are multiple p
The headline news: The trade-war headlines are coming in thick-and-fast, with none of them truly substantial. Nevertheless, they have proven sufficient to belt market sentiment around, and dictate financial market activity, once again. A re-cap of the (dis-jointed) narrative is handy, for the benefit of context. Yesterday our time, markets trembled on news that, at one of his notorious “MAGA” rallies, US President Trump announced he thought the Chinese “broke a [trade] deal”. Stock markets fell.
A choppy week ends generally flat for Wall Street: Global stocks ended the week on softer footing. But if one narrows their attention to just the S&P500 as the bellwether, the past 5-days culminated in only a 0.76 per cent fall. Trade continues to dominate sentiment on a macro-scale. The US-China trade-war has deteriorated considerably, with positivity in the market currently being sustained by some vague hope that US President Trump and Chinese President Xi will meet on the sidelines of Jun
Theresa May is coming under increasing pressure from MPs to stop the gridlock on Brexit negotiations.
The pound is expected to see further volatility until at least mid-January as the unknown future of Brexit continues.
The Dollar continued to trade at a 19-month high on Monday as concerns over slowing economic growth have reduced the appetite for riskier stocks and currencies and have backed the greenback as a safe-haven.
The price of bitcoin has fallen below the cost to mi
Fear of an increase in protectionism from the United States causes Asian equity markets to dip.
Profit warnings rise 29% quarter on quarter to 58 FTSE listed companies. Retail sector leads the way, and its expected the earnings shall continue due to uncertainty in the future.
Brexit secretary Raab says that the ‘no deal’ option is still on the table. GBP opened marginally down, but came back and has now gained from the Friday close.
G20 central bank leaders have warned that
ASX’s looming recovery: The ASX200 has clawed itself to a level on the cusp of validating the notion that the market has bottomed. It might feel that we ought to already be at that stage, given we sit 7-and-a-half per cent of the markets lows. But turnarounds take time to be confirmed, and now having broken psychological-resistance at 5800, Australian equities are inches away from that point. There are counterarguments to be made, to be fair: the recent rally has come on the back of lower volume
American stocks fall: Wall Street looks poised to register its worst daily performance since the start of the year. The technical action was sweet: another early challenge of 2815 – the price ran slightly above that – before the bears swooned, and traders “pulled the trigger”. It’s been a day of selling since, with the S&P500 down 0.6 - 0.8 per cent, at time of writing. It’s nothing to be too concerned about, of course. This is nothing like the behaviour witness at the end of last year. It’s
Market sentiment: The prevailing wisdom in the market was challenged on Friday night, and it resulted in a small shift in fundamentals. US Non-Farm payrolls were released, and despite the overarching bearishness towards the US economic outlook currently, managed to exceed expectations. Granted, the unemployment rate ticked higher and wages growth fell. But the jobs change figure revealed a much better than expected 224,000 jobs were added to the US economy last month. The results naturally weren
Trump’s G20 Summit: Love him or loathe him, Donald Trump seems to be able to get things done. Given he is the most powerful man in the word – at the very least, in a political sense – perhaps this isn’t such a difficult task. When you have the world’s largest economy, coupled with the world’s most potent military at your disposal, one would have all the leverage needed to get their way. But nevertheless, arguably not since Ronald Reagan has global politics experienced such a rapid ideological sh
Written by Kyle Rodda - IG Australia
What’s making headlines: There’s an hour and a half to go in the US session and global equities are up. Let’s assume they finish that way – there is plenty of room for clarification (and rationalization) late-on, if need be. Traders have taken the new green shoots in the trade-war and spun them into a positive narrative. Sure, the old green shots lay trampled below the new ones, but perhaps this time around the positivity will be given a chance to thrive
Asia share markets mixed, China up on stimulus hopes
GBPUSD hits a one year low as Brexit fears continue.
Sterling’s slump guided the FTSE on a stellar rally.
USD/TRY poised for continued big volatility swings over US/Turkey meeting.
Oil price steady after sliding 3% yesterday.
Asian overnight: Asian stocks were largely higher, with Japanese indices providing the one outlier amid a wider rally led by rampant upside for Chinese and Hong Kong stocks. One major drag
Tiger Woods achieved his fifth Masters victory. The victory is worth around $22,500,000 to his sponsor Nike (according to Aprx Marketing data).
Asian shares crept towards nine-month high after US treasury Secretary Steven Mnuchin reported a positive outlook on trade talks. The Hang Seng rose 1.2% and the Nikkei climbed 1.4% to reach it's highest level in 2019.
USD/JPY dips from 112.09 high this morning (following mid week rise last week).
Volkswagen unveiled the ID Roomz
It Can Be Difficult to Measure Complex Issues Like Trade Wars
When dealing with a complex fundamental theme – without a binary outcome, numerous inputs and important to different investors for different reasons – it can be difficult to both analyze and trade the subject. Those are certainly criteria that would fit the ongoing trade war. It is proving exceptionally difficult to keep a clear bead on the progress of the economic conflict and the market has started to veer back into its comfort
Australian data draws global interest: Australia’s remarkably weak growth figures captured attention, both locally and abroad. The numbers conveyed in yesterday’s GDP were truly disappointing. Growth in the final quarter of 2018 was a paltry 0.2 per cent, and after another set of revisions to previous data, the annualized growth rate fell to 2.3 per cent. Each figure was quite an undershoot of expectations: for one, economists were expecting the quarterly number to come-in-at 0.3 per cent in sea
Written by Kyle Rodda - IG Australia
First trading day of the new year: Traders picked-up right where they left-off in the first trading day of 2019. Hardly a true microcosm by any means, but the last 24 hours could be considered an appropriate metaphor for how analysts expect markets to behave in the year ahead. Dire warnings out of Asia about global growth, backed-up by lukewarm activity in Europe, finished by a wildly fluctuating Wall Street. Trading conditions haven’t totally returned t
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