UK Competition and Markets Authority have formally blocked the proposed £7.3 billion takeover of Asda by Sainsbury's causing the merger to collapse.
Corporate earnings reports see European stocks set to open slightly higher. The FTSE 100 rising 9 points to 4780. Whereas Wall Street ended Wednesday's session lower following mixed US corporate results.
Despite beating analysts expectations UBS reported a 27% fall in net profit for it's first quarter when compared to the same period
Written by Kyle Rodda - IG Australia
The pattern continues: Wall Street indices have been swinging about madly again. The pattern continues: an open, a rally or fall, then a retracement or recovery. Today we’ve had an open, a rally, then retracement, then a recovery again. There were stories behind this price-action. Everything that happened overnight appeared perfectly explicable. One wonders though if the swings in trading activity are being overly attributed to headlines. Or perhaps it’s
A thus far settled start to the week: It was a day of low activity and mixed results, generally across global markets in the last 24-hours. Equities were patchy in their performance, on much lower than average volumes, while a retracing in bonds revealed stable risk-sentiment. It hasn't been so for some time, but yesterday market participants behaved in a classic "Monday" way. There was a lack of a unifying theme to drive market activity in a macro-sense, leaving traders to trade-off the idiosyn
Up, down, turnaround: It’s been a bipolar market of late. Global stocks are moving in unison, and have swung from broad-based losses on Friday, to broad-based gains overnight. US equities are naturally the exemplar and are a responsible for driving overall risk appetite. With an hour left in trade (and as a quick aside, Wall Street closes at 7am AEDT for the next few weeks) the S&P500 is up well over 1 per cent. It’s been a day of relatively low activity. However, breadth is expansive: over
Written by Kyle Rodda - IG Australia
Friday session: Friday capped off another horror week for Wall Street. It was US equities’ worst week since March. Traders are currently operating within a volatility trap – and there are few indications this will soon end. The VIX is elevated, above 23 at the last reading, but occupied time above the 25-mark at stages during the week. Volatility is an active trader’s friend, and for the most part the opportunities it has thrown have been relished. Liqui
Sentiment weaker; but ASX to rise: SPI Futures are indicating an 11-point gain at the outset for the ASX200 this morning. It's perhaps a surprising result, given overnight activity. The chorus of pundits calling an economic slowdown grew louder, backed up by weak data and some unfavourable headlines. The Australian Dollar is better reflecting the dynamic: it's fallen through the 0.7100 level to eye support at 0.7040. Perhaps the weaker A-Dollar is behind some of the expected lift in Aussie stock
The United States and China Jostling for Economic Supremacy
The world’s largest economies are starting to update on the status of their health. And, though it may not seem to be the case in these speculatively charged markets, financial performance relies heavily on a healthy global expansion. This past Friday, China reported its third quarter GDP reading. The 6.5 percent clip would be an enviable pace for most of the developed world, but for this debt laden country, this is slowing to a pa
Asian market gain whilst Chinese shares hit a 1 month high on hopes of a government stimulus package.
Hedge funds bet on higher government bond yields extending the USD gains, and prompting a gold sell off.
Oversupply worries continue with oil causing a drop in prices.
Despite Google's Alphabet multibillion dollar fine, shares jump on results to a record breaking all time high.
Crypto markets currently up but generally trading in a range.
Asian overnight: A po
Deal done: Hopes were whetted during overnight trade from the news that the US, Mexico and Canada had agreed to a revised “NAFTA” agreement. To be (re)named USMCA – the US-Mexico-Canada-Agreement, a clear declaration of the Trumpian neo-Nationalist, “America First” agenda – the trade agreement reconfigures the North American trade consensus, with a skew towards US economic interests. It was apparently the Canadian’s who finally caved in to political and economic pressure on the trade pact, backi
ASX edges higher: The ASX200 edged higher yesterday, as what is a technically overbought market recovered some of its Friday losses. Upside momentum has clearly cooled for the local stock market, ahead of a week heavily geared towards positioning for this weekend’s G20 meeting. Overall, it must be said it was a low impact and low activity day’s trade yesterday. Consumer stocks were most responsible for the day’s losses, sapping around 4 points from the ASX200, while Real Estate and bank stocks l
Written by Kyle Rodda - IG Australia
A relief rally, now onto the next risk: The relief rally for market-bulls was sweet, but fleeting: it’s on to the next risk event now. Traders are being inundated by information, much of it speculative. Against this backdrop, volatility reigns: while off its highs still, the VIX is up 2.7 per cent on the day. To be clear, the Fed’s dovishness and Mr. Powell’s-famous-Put is underwriting the potential for future bullishness. But market participants can’t a
US-China Trade War Moving Beyond Boundaries
As expected, the relief from trade wars didn’t last long. Not a week after US President Trump and EU President Juncker announced an armistice on tariffs between the two dominant economies, the former revived pressure on its favorite target: China. Trump had issued threats of escalating tariffs against its trade-dependent counterpart over previous weeks, but the impact of the warning seemed to come with shorter half-lives than what we had experienc
Mixed trade across the globe: Global equity indices have traded mixed in the last 24 hours. Asian trade was soft, European trade was poor, while US indices look as though they will deliver another day in the green. This may not be such a bad thing: perhaps the differing performance across regional indices is a sign of a more discerning market place. Panic about the global economic landscape has subsided for now, allowing traders to take a more nuanced view of the asset class. There is a degree o
The rebound in Chinese stock markets has extended and US bond yields are steady after the market digested the trade tariff news. MSCI Asia-Pacific index up 0.95%, whilst the Japanese Nikkei rises 1.3%
A reclassification of the S&P 500 will see tech behemoth such as Facebook and Alphabet move from 'information tech' stocks into 'communication services' along with about a fifth of the index.
Oil prices are seen to consolidate after rally.
Cryptocurrency markets are holding
Politics and Markets
There are numerous, open political fissures around the world – including the approaching Brexit deadline; the ongoing flux of Euro-area stability and Chinese social pressure arising from economic concerns. Each of these represents significant headline fodder both within their respective country as well as in the international press. Yet, as many newspaper column inches or top headlines in online news aggregators these issues may represent, they don’t naturally adapt to
Written By Kyle Rodda - IG Australia
The bullish week continues: The pointy end of the week has arrived, and so far, the news flow is lining up well for the bulls. The big release, perhaps for the whole week, was this morning’s FOMC Minutes. Naturally, the information is old, relevant mostly to the December 19 period in which the central bank met. But given the market turmoil experienced since then, along with January’s nascent recovery, this set of Fed minutes has taken on slightly greater
Written by Kyle Rodda - IG Australia
US traders return: It’s nice to be back to some normal programming. The big-wigs on Wall Street have returned to their desks and volumes across the market are looking far healthier. After last week’s sell-off and volatility, and well before the meaty part of trade this week, traders appear to have had their appetite for risk whetted. Only slightly, of course: there is an acute awareness that the next seven days will hurl up some major events and some sig
Calmer trade, vigilance remains: The sense of cautious optimism in markets remains. Extreme swings in sentiment have been absent. Calm prevails, albeit within a mindset of greater vigilance. There hasn’t been a face ripping rally, nor a vertigo inducing fall, in global equities this week. The trading activity does feel distinct from that which was experienced in December. Fear and subsequent volatility is unwinding. The VIX continues to edge lower, though at a slower pace now. Several of the pan
Fed sparks bullish sentiment: Traders were bullish overnight, but as far global equities go, the ultimate results were mixed. Activity has been very high, that’s irrefutable. Volumes flowing into stocks have been much higher than average, no matter where you look. Fundamentally, the Fed has lit a fire under markets, and traders are repositioning to adjust to a new set of circumstances. The fundamentals have shifted in quite a meaningful way. It’s the notion that the Fed will maintain monetary po
Earnings optimism tempers the markets’ mood: Financial market participants curbed their enthusiasm yesterday. Friday’s brief excitement on Wall Street relating to a handful of earnings beats from some of the US’s big banks failed to translate into meaningful momentum to begin the new trading week. Such a dynamic was also evident throughout the Asian session. The ASX200 closed flat for the day, and Chinese stocks rallied and retraced all in the space of a few hours. The Nikkei was higher for the
Written by Kyle Rodda - IG Australia
A pull-back amid interesting activity: Markets received their slingshot higher and continue to swing about in both directions. That’s the key takeaway from last night’s trade; of course, that’s all too general, though – akin to explaining a rally in the market to their being more buyers-than-sellers. Yes, it’s self-evidently true, however it does little to answer the question of “why?”. Overall, market activity in the last 24-hours has provided a much gr
Stocks recover losses on rate-cut hopes: Wall Street equities climbed into the close, after an ugly open for the US market overnight, while global bond yields continued to fall, on increased bets of interest rate cuts from the world’s largest central banks. When market action is still foggy, it can be hard to draw firm conclusions about cause-and-effect in price action. But it would strongly seem that the latter was responsible for the former during last night’s trade. Hence, US stocks were up o
Trade negotiations: Global markets ended last week on the back foot, after trade talks between the US and Canada stripped traders of some hope that the global trade-war may be de-escalating. It was figured that following the relatively positive developments in US-Mexico trade negotiations early last week that perhaps a change of tact was emerging from US President Trump’s administration regarding global trade. Hopes were quashed upon news that negotiations between the US and Canada had broken do
Risk Trends Trembles, Is it the ‘Crazy’ Fed’s Fault
Market’s suffered a painful correction this past week. From peak-to-trough, the benchmark I like to refer to as a measure of hold-out enthusiasm, the S&P 500, dropped nearly 8 percent. That is still a ways from the technical ‘bear market’ designation which is a 20 percent correction from peak highs, but that scale of loss from a seemingly indefatigable climber rattles confidence. To be clear, the slump in sentiment was not isolated to
The pound ticked higher after dropping on Tuesday after Theresa May’s amended Brexit deal rejection. Today’s vote in the UK parliament whether to leave the EU without a deal is unlikely to provide excessive pressure on the sterling in case the proposal is rejected, however downside risk exists. Cable was almost flat as of 7:30am GMT trading at 1.31069.
The US dollar floated and yields fell on Tuesday after softer inflation data increased the possibility of more dovish policies from the Fe
