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
US GDP data capped-off last week’s trade: Trade closed last week on something of a puzzling note. The attention, from a macro-economic point-of-view, was fixed in on US GDP data. Amidst all the fears of slower global growth on one hand and hope for a nascent global economic turnaround on the other, the US growth figures were being viewed as a tangible insight into the cogency of each point of view. Ultimately, the data provided little support for one over the other – and perhaps even deepened th
Stock markets continue to recover: Global stocks have maintained their bounce. It’s looking more like a market that is searching for it’s next high now, as price action, from a technical perspective, suggests the recent wave-lower is over. Hence, from here, considering trade-war risks, and therefore anxiety in the market, remains high, the matter becomes whether stock indices are preparing to pop in a new higher-high, or whether what we will see is a new lower-high. The result of that simple bin
A three-year legal battle has concluded with the EU enforcing stricter copyright laws that could affect the business models of tech giants like Google and Facebook. The new reform plans to protect artists and publishers whose work has been widely spread on the internet, by making the tech firms responsible for detecting and removing content that infringes copyright law. Google will has been very critical about the new reform saying that it will restrict freedom of expression, as its video-sharin
Asian Pacific markets were mixed on afternoon trading, edging off seven-month peaks as investors digested a rebound in U.S. jobs data and reports of more progress in the trade negotiations between Washington and Beijing, but still cautious on the outlook of the global economy and the U.S. earnings season.
The U.S economy added 196,000 jobs in March, beating economists' expectations of a figure of 175,000.
Chinese blue chip stocks climbed in the initial session, however slipped sl
Markets returning to normal trade: Traders in the US and UK returned to their desks overnight, and if price action is any guide, their verdict of the weekend news flow is “not much has really changed”. This isn’t to say the movements in financial markets in the past 12-18 hours have been ones of major conviction. Afterall, volumes are still light and the extent of the moves in price witnessed were modest. Nevertheless, despite what was notionally a tranquil weekend for financial market news, mar
Dear IG community,
There will be some changes to some of our Asian markets over the upcoming Lunar New Year, starting Monday 4 Feb. We will continue to make out of hours index prices throughout any breaks (excluding Taiwan and Malaysia).
See the table below for the relevant information.
South Africa’s Platinum Group Metal (PGM) is bracing for industry-wide tough salary negotiations as it urges the government to invest in platinum markets. Chris Griffith, Chief of Anglo American Platinum Ltd, the world No.1 miner, reassured investors that workers are likely to avoid prolonged strikes. Meanwhile, the rand basket price for platinum and its sister metals rose 20% to 25 % this year already. Slowing global growth could pressure the metal, which hit $891 at 6:00am GMT+1 on the IG Web
A night of mixed trade: Overnight trade might be considered an elegant microcosm for the affairs of financial markets right now. The news flow shifted from mixed, to bearish, to bullish, then back to mixed again. The story began with a US Retail Sales data-beat, that cast doubts on the Fed’s need to cut interest rates. That doubt was compounded by more soft-ish bank earnings in the US. The mood then turned decidedly nervous on headlines US President Trump stated his willingness to increasing tar
News flow light thanks to US holiday: SPI Futures are indicating a flat start for the ASX200 this morning, in a 24-hours starved of meaningful news and data. US markets were closed for the Presidents’ Day holiday, meaning a crucial source of information was absent from the news flow. It was perhaps a positive thing for market-bulls: the vacuum left by US markets allowed for Asian and Europe equity indices to seize the improved sentiment flowing from Wall Street on Friday, following further progr
Another trade-war headline downs sentiment: There’s some news floating through the wires that sentiment has taken a hit overnight courtesy of some unfavourable trade-war headlines. It’s been reported that Chinese officials aren’t co-operating with their US counterparts, as it applies to certain sensitive elements of trade-negotiations. The S&P500, which had been developing some intraday momentum prior to the release, has retraced throughout trade, consequent to the news. It’s closed flat for
The start of something new: A new day, week, month and quarter today; and what a difference a little time can make. 3 months ago, at least for some, global financial markets stood at the brink of ruin. It was December 24 last year that the S&P500 hit its low, but it wasn’t until the start of January that something resembling a turnaround in US stocks transpired. Fast forward to now, and Wall Street is over 12 per cent higher, and though at stages has looked extremely vulnerable to turnaround
Gold prices edged lower as the yellow metal’s rally might be over. Spot contracts hit $1306 at 6:00am GMT on the IG Web Trading Platform. The safe-haven appeal of the gold bullion seems to fade as investors get more bullish on a possibly incumbent US-China trade deal. However, according to Goldman Sachs the combination of a pause in interest rate hikes by the Federal Reserve and more robust growth in emerging markets could weaken the US dollar and support the gold price.
As palladium hit
Market action proves it again: this market hinges on the Fed: The US Fed has proven itself as the most important game in town for traders. The FOMC met this morning, and lo-and-behold: the dovish Fed has proven more dovish than previously thought; the patient Fed has proven more patient that previously thought. Interest rates have remained on hold, but everyone knew that was to be the case today. It was about the dot-plots, the neutral-rate, the economic projections, and the balance sheet run-of
G20 outcome bolsters sentiment: Market activity was defined by a demonstrable lift in risk appetite yesterday. Stock markets rallied, especially in China, and the S&P500 touched new all-time highs. The Yen dipped, as did the Swiss Franc. The stronger Greenback combined with the lift in global bond yields knocked gold prices down below the $US1400-mark. And oil rallied – boosted, too, by the prospect of coordinated supply controls from OPEC-members at their meeting this week. While the positi
Deutsche Bank and Commerzbank have announced formal merger talks which could result in the combined bank holding one fifth of Germany's High Street banking business.
Asian shares rose despite reported potential push back of agreement to end trade war. The Hang Seng gained 1%, the Shanghai Composite surged 2.3% and Japan's Nikkei climbed 0.6%.
Trump's weekend tweets ramped up the pressure on General Motors to reopen Ohio manufacturing plant which recent's closure cut 1,700 jobs.
What are Central Banks Attempting to Achieve at This Point?
Over the past two weeks, we have seen major central banks loosen the reins on monetary policy or otherwise set the stage to move further into unorthodox policies. The most notable moves were made by the European Central Bank (ECB) and Federal Reserve. The latter cut its benchmark by 25 basis points to bring its range down to a high level of 2.00 percent – though it maintained its increasingly dubious position that it expects no fu
Markets trade thin ahead of central bank risks: It’s said that money makes the world go around. And given central bankers control the money of the world, it is they who decide when the turning starts and stops. Described this way, central bankers role in the economy sounds Bond-villain-esque. That’s entirely unfair of course – only fringe-dwellers would suggest they are so malevolent. But recent history, based on experiential evidence, suggests that when it comes to financial markets, the action
Positioning for the week’s climax: A little water-treading, as all eyes turn to Washington this weekend. And for two-reasons, really: highly anticipated trade-talks between the Trump Administration and Chinese officials – which includes Vice Premier Liu He; and the release of US Non-Farm Payrolls data by the US Bureau of Labor Statistics. Both promise to be potentially market moving events. Fundamentally, both events come in one-and-two as the week’s most significant macro-economic stories. How
Another record-reaching session: US stocks have notched-up another record high, as the S&P500 closes in on the 3000-mark. The ASX200 yesterday came close to its own psychological milestone, nearing the 6700-level. The highs came on a light-day’s trade on Wall Street, however, with US markets trading-in a shorted session in ahead of the Independence Day holiday. Currency markets were more volatile, with commodity currencies climbing courtesy of several positive trade balance data out of New Z
Trump-Tweet #1: US President Trump announced yesterday what had long been assumed: the trade-truce will be delayed, because of the “very productive talks” going on between his administration and Chinese policymakers. Understandably, the formal recognition that tariffs won’t be hiked to 25 per cent (from their current rate of 10 per cent) on $US200bn of Chinese goods stoked risk sentiment. The overall impact wasn’t quite as deep and broad on one might have hoped, however. The reasoning is logical
Wall Street trade: Rolling into Wall Street’s close and the S&P500 is battling it out with the 2800-mark. There’s two hours to go in trade as this is being written, and the crucial last half-hour of trade is what analysts will be breaking down today. It’s been for all intents and purposes a flat day for US stocks, but another bout of selling into the close will add credence to the idea that the buyers are thin at these levels. Market internals don’t appear too stretched for the S&P, and
The Euro was nearing a 21-month low yesterday as the ECB was perceived to be dovish after its speech, ahead of US jobs data to be released today. During Thursday's session the EURUSD hit $1.1176, its lowest since June 2017, as the ECB announced it had pushed back the first rate increase to at least 2020 and announced a new round of TLTRO funding for European Banks.
China has reported worse than expected trade data for the month of February. Its dollar-denominated exports fell by 20.7 per
Aussie growth underwhelms: Australian GDP data was the highlight of the economic calendar yesterday. All-in-all, the data was of minimal impact, though it did for make big headlines: the growth rate came-in at 1.8 per cent on an annualized basis, as expected – the slowest rate of economic growth since the GFC. A poor print undoubtedly, but one that had been priced into the market well in advance. Hence, markets were little moved upon the release. The ASX200 hardly budged. The Australian Dollar l
Don’t Forget Trade Wars Aren’t Isolated to US-China
Trade wars remain my greatest concern for the health of the global markets and economy. There have been threats in the past where a localized fundamental virus has turned contagious to the rest of the world by unforeseen circumstances – such as the Great Financial Crisis whereby a US subprime housing derivative implosion infected the wider financial markets by destabilized a foundation built on excess leverage throughout the system. When i
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