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JasmineC

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  1. JasmineC

    Trader's View - APAC brief 21 Aug

    Global equities: Global share-markets experienced a lift overnight as European and US investors jumped online to begin the week. The overall mentality now can be characterized as one of cautious optimism ahead of low-level US-China trade talks, mixed with a touch of relief that crises in Turkey and other emerging markets are currently quarantined. Chinese markets picked up steam in late trade because of this point of view, while the Dow Jones represented this broad attitude during the North American session – adding 0.35 per cent, largely thanks to a pick-up in the industrial sector. The best performer of the major indices though was the DAX, which managed to turn around the weakness reflected in futures markets earlier in the day, to clock gains just shy of 1 per cent at that market’s close. ASX: The general positivity during overnight trade establishes a positive lead for the ASX200, with SPI futures presently indicating a 3-point jump at the open. Trade was very subdued in Australian shares for the best part of the day yesterday, as traders stepped back from the market after the ASX’s early morning leap proved fleeting. It was likely a profit-taking opportunity for punters, who lacked the impetus for further buying following a handful of soft company reports prior to market open. Coming into the day a level to note was around 6360, which signified the extension of an upward sloping line of resistance, dating back to 2016. True to form, the ASX high for the day was just below this mark, perhaps providing insight into where the next major barrier exists for the index. Reporting Season: Carrying-over from what was generally considered to be better than expected results from the reporting company’s last week, hope sprang leading into yesterday’s trade that the outperformance from Australian corporates would continue. In isolation, the earnings figures from the company’s reporting yesterday were relatively underwhelming, with none of the handful of major reporting company’s exceeding estimates. Woolworths was the headliner yesterday, and despite reporting respectable profit growth and a bonus dividend, the company’s stock fell by over 1 per cent after sales growth and net income printed weaker than expected. The day ahead will see interest turned to results out of BHP and Seven West Media this morning. ASX and Trade Wars: One interesting take away from the day’s reporting might be the small cracks appearing in some segments of corporate Australia because of the developing global trade war. For one, Fortescue Metals reported yesterday and disclosed lower revenues and a forecast period of slower growth as demand for iron ore falls. But perhaps the more interesting trade-war related takeaway came from Ansell’s earnings call, which revealed that along with softer earnings in the last year, the company expects to grow at a slower rate than previously expected due to the higher input costs related to the trade-war. The Ansell example shows how insidious the impacts of higher costs associated with protectionism can be, and how acutely these impacts can be felt by investors. Trump’s cherished Dollar: The US Dollar took a tumble last night, ending in effect its week long bullish tear. The fall came on the back of a news release that US President Donald Trump (has once again) openly chastised US Federal Reserve Chair Jerome Powell – this time while delivering a speech at a charity event. The US President stated he thought Chairperson Powell would be a “cheap money” Fed-Chair and lamented the increase in US interest rates. The US Dollar Index fell 0.2 per cent as the news trickled through the newswires, pushing the EUR/USD back towards the 1.15-mark and the AUD/USD through resistance at 0.7310 to trade 0.7340 when last looked. The US Dollar is now sitting around 40-points above quite a significant support level at 95.40, the collapse of which would take the greenback back to the levels it was trading at prior to the Turkish Lira crisis. RBA and local interest rates: The day ahead will be one focused on RBA policy and Australian interest rates, as traders prepare for a speech to be delivered by RBA Governor Philip Lowe early this morning, followed by the release of the RBA’s Monetary Policy Minutes at 11.30AM. While broader macroeconomic insights will be analysed closely by market participants, the content out of both today’s events will likely prove solely academic. Subjects like trade wars, inflation, private debt and the property market will capture interest, but what can be inferred from the discussion on these topics probably won’t move markets. The RBA has fallen in line with interest rate markets, particularly in recent months, strongly implying that Australian rates will not be shifting until early 2020. As such, what information received today out of Governor Lowe and the RBA will have already been priced-in to rates and currency markets. Global interest rates: The area of global financial markets that has been – and will continue to be – of greatest interest this week is US interest rates. The annual Jackson Hole Symposium is scheduled this week and will be prefaced by the release of FOMC Monetary Policy Minutes for the Fed’s most recent meeting on Thursday. The theme dominating trading leading into these events is the stubbornness of long term US bond yields, and the market’s apparent reluctance to push yields higher in tandem with short-term rates. The situation has some pundits worried, given the myriad of risks in markets currently, and the fact an inverted bond yield often portends recession (see 2Y and 10Y spread below). However, for equity markets, lower long-term funding costs would support valuations and attract yield chasers into stocks, so it may pay to be privy for stock traders to keep track of monetary policy news as the week develops. Information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  2. JasmineC

    Trader's View - APAC brief 20 Aug

    Last week: At the end of a week that may have been best described as nervous and jittery, markets closed trade in a relatively subdued fashion. The news that the United States and China may re-enter trade negotiations provided the basis for the stability, but the reactions to that news were hardly ecstatic. This is justifiably so, considering investors have become very accustomed to overreacting to news that turns-out to be little more than fluff. The crisis in Turkey has temporarily settled, though could easily flare again at a moment’s notice, as investors prepare for a week with a smattering of key data events, but that also includes the likely implementation of a new round of tariffs from the US and China. Wall Street: Wall Street reclaimed some of the territory it lost throughout the trading week, led by the Dow Jones, which added a solid 0.43 per cent. This came after a mediocre day in European markets, which were generally lower for the session. Amid trade wars and emerging market chaos, many analysts have been heard imploring clients to focus on strong corporate profits to guide investment decisions. Price action in US indices supports this notion, continuing their uptrend despite the risks. The S&P500 has inched away from clocking new all-time highs, while cooling enthusiasm for US tech stocks weighed on the NASDAQ; however, the Dow Jones is coming to close to approaching levels not seen since February this year, indicating a burst higher could be mounting. ASX: SPI futures are currently pointing to a solid open for the ASX200, a remarkably upbeat start to the week considering investors are coming off another day in which the index clocked new decade long highs. There was a dearth of news for local investors to trade off on Friday, the effects of which could be observed in the thinner trading conditions and flat price action for some segments of the market. The element that tipped the ASX into a net positive position was the relief that the US and China would restart trade talks, and was in effect was responsible for the 0.2 per cent gain for the day. If Aussie shares can keep momentum and trade higher this morning, keep watch for 6360 as perhaps being a noteworthy resistance level. Earnings season: It will be investor’s reactions to reporting season that will probably prove the ultimate arbiter of the Australian equity market’s strength or weakness, following a day on Friday that lacked heavy hitting company announcements. Activity will be far higher today and the rest of the week, as we enter what is probably the densest part of reporting season. In the day ahead, Woolworths jumps out as the most significant earnings report, with that company expected to show modest Net Income and Earnings Per Share growth over the last 12 months – a result which is estimated to translate into a dividend of 0.93c. Woolworth’s share price has performed reasonably well over the past year, climbing just over 9 percent, although the momentum has shifted in the last 2 months: look for price action up to $31.30 if the today’s results surprise significantly to the upside. Greenback: The USD has pulled back over the last few days, following a week during which the greenback smashed its way higher. The search for solid and secure yield in a safe-haven asset has diminished, resulting in funds flowing into other asset classes as risk appetite returns. The AUD/USD has possibly been one of – if not – the greatest beneficiaries of the reduced Dollar bullishness, managing to climb back above the 0.7300 handle — and crucially through resistance 0.7310. The EUR and GBP have also come under a touch less pressure, while the Yen has maintained its strength across the board. Despite the dip, the trend will remain on the upside for the USD for the foreseeable future, particularly if global financial stability remains a concern: look for 96.70 on the US Dollar Index as the next level of potential resistance. US Treasuries: As sentiment and volatility normalises, it may pay to keep privy of US bond markets this week. The action last week resulted in markedly lower US Treasury yields, and a much flatter bond curve. The yield on 6-month Treasuries fell by 8 points, while the spread between the 2-year and 10-year yields is currently a narrow 25 points – with the yield on the latter of the two assets falling to 2.86 per last week. Given this price action, it may be that not only are investors questioning the US Fed’s willingness to hike rates too steeply in a higher risk environment, but also, that they possess greater anxiety about longer term economic growth prospects, both in the US and abroad. This week: A look to the week ahead provides the best foundations of achieving some equanimity before trading really takes-off. In global news, the next round of US and Chinese tariffs is arguably the most significant event, although little reaction is expected in markets given the event is seemingly priced in. Central bankers have their annual retreat in Jackson Hole, Wyoming to mull over monetary policy, with the interest there in the longer-term picture of monetary policy globally. This will provide the backdrop for the US Federal Reserve’s Monetary Policy Minutes release, along with the release of the RBA’s own minutes from their recent meeting this week, too. Please note: This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  3. JasmineC

    Trader's View - APAC brief 17 Aug

    Sentiment boost: The unpredictable ebbs and flows of volatile global markets delivered a positive outcome overnight, as equity markets recovered lost ground courtesy of a healthy boost of positive sentiment. The increased investor optimism came following news that US and Chinese officials are in talks to renew trade negotiations. This comes only days from the next round of tariffs due for imposition on Chinese imports into the US from the White House, which will rise to the value of $US50b worth of goods. The favourable developments managed to distract from the uncertainty surrounding the Turkey crisis, that at this time continues unabated. North America: Wall Street bounced off the canvas in response to the slither of good news, regaining some of the day prior’s lost ground. The S&P500 was up 0.9 per cent in late trade and the trade sensitive Dow Jones was up a remarkable 1.6 per cent, while the NASDAQ lagged due to the lingering effects of the day prior’s minor tech sell-off. In what can be extrapolated to be a very good news story for the US economy, market giant Walmart rallied in the session, buoyed by news that it posted its best sales growth in a decade. The news affirms the strong US Retail Sales data released on Wednesday and supports the notion that the US consumer is underpinning strong economic growth. ASX: The ASX200 had another day worthy of a sprinkling of pride, managing to shake-off a steep fall in early trade caused by a weak lead from overseas markets, to close the day only 0.01% lower. In another day that vouched for the Australian share market’s underlying strength, the ASX proved to be one of the few shining lights in the region, with Asian equities experiencing a dumping throughout the day’s trade. Given that 6300 has been broken and the trading day ahead is expected to be characterized by a boost in confidence, the question becomes whether the ASX can again clock a decade long high, and close above 6330. Reporting season: The ASX’s success rests on whether a so far solid reporting season can continue today, with few Blue Chip and large-cap company’s reporting as compared to the last few days. In terms of interesting stories, Kogan reports this morning, but will unlikely shift market fundamentals or sentiment, while a handful of real estate and mining companies report. Yesterday witnesses some remarkably strong activity from some of the ASX’s larger reporting stocks, the most noteworthy being Treasury Wine Estates and QBE Insurance, with both clocking in over 5 per cent gains yesterday. Telstra also reported and experienced a modest relief rally, while Origin energy disappointed, selling-off after the company again stated it would not be paying a dividend. Employment Data: Australian economic data was also being watched by the macro-buffs yesterday, as the ABS released monthly employment data for the month of July. Coming into the event, the figures weren’t expected to rattle in the slightest financial markets, particularly that of the currency and interest rate markets, with investors writing off the prospect of RBA action for the next 18 months. The figures released yesterday were mixed, but on balance could be considered a net-positive: the Australian economy lost just shy of 4k jobs last month, but the month prior’s figures were revised upwards enough to push the headline unemployment rate down to 5.3 per cent. Interest will turn today to RBA Governor Philip Lowe’s assessment on the situation, as he testifies before the House of Representatives. China: Chinese markets will be under the microscope today, especially considering the sanguine view adopted by investors last night following revelations that the US and China may be returning to the negotiating table. Chinese equities will be watched closely given their troubles recently, but its most definitely the Yuan that will experience the most scrutiny today, after the USD/CNH plunged to almost 6.96 yesterday. The pair has since recovered its losses in the overnight session on the back of last night’s trade-war developments; however, knowing that the more positive trade war stories have often end up no more than fluff, the curious point will be whether the PBOC will allow its currency to depreciate all the way to the 7.00 mark if things do turn dire. Brexit: The major global news story today will surround the latest round of Brexit negotiations, with activity in the currency markets the area to watch around this. We are creeping closer to a no-deal outcome from Brexit as a deadlock between both parties fails to break. The situation isn’t helped by the political disfunction within the ruling Conservative, which appears unable to establish a single and cogent position on the matter. The Pound has taken a belting consequent to the disorder, a dynamic compounded by the roaring greenback, to trade at 12 month lows this week. The fortunes for the pound don’t appear good, but if there is a surprisingly strong outcome to the Brexit negotiations, perhaps a bounce in the GBP/USD is overdue. Please note: This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  4. JasmineC

    Trader's View - APAC brief 16 Aug

    Sentiment: Global risk appetite diminished once again overnight, sparking sell-offs across equity markets. The concerns about the fragile state of the Turkish financial system and what that might mean for markets was behind the fall, as traders sought out safe havens to park their money. The US Dollar held its advance consequently, but it was the JPY that saw the most activity, with the USD/JPY falling as low as 110.43. Following Tuesday’s relief rally, it would appear investors aren’t quite prepared to let go of the risk associated with Turkey’s financial crisis, which is compounding fears about trade wars and slower global economic growth. The risk-off play may find itself fuelled today, as investors become wary of the next round of Brexit negotiations, due for kick-off in the next 24 hours. Commodities: Commodities markets experienced some of the most volatility in the overnight session, slammed by fears of global financial risk and economic slowdown. Copper entered a technical bear market, as it tore through the $US60.00 mark and several lines of resistance to trade at $US57.92. Oil slipped too, owing to fears of lower demand due to slower global growth, and after crude oil inventories printed higher than forecast. Gold’s aggressive sell off continued, plunging through support at $US1180 an ounce, and seriously opening-up further falls towards $US1120. Of relevance to Australia, iron prices were one of the worst performers for the day, pin dropping 3.5 per cent, portending a tough day for mining stocks. Overnight session: Stocks in Europe and on Wall Street took a plunge courtesy of the weak sentiment last night, with the FTSE and DAX giving up around 1.5 per cent, and the US benchmark S&P shedding 0.76 per cent. The shift lower was led by global tech stocks, which were rattled by news that Chinese tech giant Tencent Holdings reported its first profit drop in a decade. The NASDAQ fell 1.2 per cent throughout trade on the back of weak sentiment and the sell-off in tech shares, weighing on the rest of US shares. The poor return for US comes even though US CPI figures overnight strongly exceeded expectations, revealing that despite the risks and interferences, the US economy is fundamentally strong. ASX: SPI futures are presently pointing to an ASX200 that will be caught in the fray of last night’s equity sell-off, indicating an open around 50 points lower. The dip will follow a day in which the local market closed at 10-year highs, as traders finally managed to push the ASX above the significant psychological barrier around 6300. Remarkably, the milestone was achieved without the collective might of the materials and financial sectors, which each fell 0.91 per cent and 0.21 per cent respectively. The hope will be now that, despite what appears to be a tough day ahead, the close above 6300 yesterday sets a precedent for the markets and can elevate to such levels with much greater ease. Reporting season: Earnings season provided the strong fundamentals for investor activity during the local session, with several stories leaping out of the day’s trade. Shooting star CSL climbed after it beat average analyst estimates, rallying to a record high above $210 per share. Wesfarmers also posted results which, although on the surface appeared incredibly poor, showed that when stripped of one off costs associated with losses and write-downs, the net income of the company was stronger than generally expected, pushing the company’s share over 3 per cent higher. The laggard for the day was IAG, which fell over 6 per cent after the company’s net income missed even the lowest analyst estimate. The earnings season will now turn likely be dominated by the release of several of the ASX’s big hitters, including Telstra, QBE and Treasury Wine Estates. Australian Dollar: The Australian Dollar remained one of the worst performers across currency markets overnight, falling precariously close to the 0.7200-flat mark. The Aussie currency has taken the form of the preferred global risk-off proxy this week, amid concerns first in China and now in other emerging markets. With risk unlikely to abate, Chinese economic growth faltering, a falling yield advantage and a roaring USD, it’s hard to imagine a situation in which the AUD will find support. Local wage growth data yesterday – which came in at expectations but revealed that the Australian economy is experiencing flat real wage growth presently – sets up the release of employment data today, with both data points likely to enervate the local currency. AUD & ASX: The silver lining to the Australian Dollar’s fall has been its support for the local equity market. In what is a rather strong correlation, the over 4 cent falls in the value of the AUD/USD since the middle of June has driven funds into the local share-market, delivering a tacit endorsement from investors to our market, corporate health and economy. The reason that the weaker currency is supportive of the ASX is twofold: on one hand, Australian stocks have become relatively cheaper when compared to their global counterparts; and on the other, revenue denominated in foreign currencies can be converted at a lower exchange rate, boosting businesses earnings. Please note: This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  5. JasmineC

    Trader's View - APAC brief 15 Aug

    Turkey: Financial markets regained their cool overnight, returning to some semblance of normal trading conditions. Traders appear a little more comfortable with the Turkey situation, apparently reassured by the idea that developed economies and financial markets are shielded from the direr consequences of a Turkish borne financial crisis. The core issue is unlikely to disappear entirely, given hostilities between the US and Turkey have only escalated in recent days. Moreover, global fundamentals will continue to work against broader emerging markets, who look ever-vulnerable to rising global interest rates and a strengthening US Dollar. However, at least when it comes to developed capital markets, it looks like the attitude has shifted to “play on”. Wall Street: Wall Street will cap off the global recovery in equities over the last 24 hours, providing a stable lead for Asian trading today. The benchmark S&P500 ended its four-day losing streak – its longest in several months – to add 0.65 per cent for the session. Earning’s season is practically done and dusted now, with investors now allowed to mull over what it all meant – and how it will affect the future. As it stands currently, the overriding belief is that there are indeed good times still to come. Assuming risks in emerging markets and geopolitical tensions remain to one side – a very big assumption, of course – the S&P seems poised to restart its journey to the all-time high at 2875 achieved earlier this year. ASX: SPI futures are indicating a softer open for the ASX200 this morning, presently pointing a modest 5-point dip at the open. Investors in Australian shares leapt at the opportunity of jumping back in to equities as the Turkey-contagion fears subsided, quickly regaining (in effect) all the territory abandoned during the day prior. It was the financial stocks, following-on from their successful week last week, that led the charge, supported admirably by the index’s relative minnow-sector, information technology. The diminution of macroeconomic themes provided investors with the scope to turn to more fundamental matters in the market, such as the local reporting season. Local earnings: Reporting season news focused primarily on two noteworthy misses yesterday: first from Cochlear, the second from Domino’s Pizza. For Cochlear, the full-year results were quite respectable, revealing that net income expanded 10 per cent and that the company’s dividend pay-out would increase by 11 per cent. However, the share fell by 3.52 per cent, unwinding a portion of the 16 per cent gain achieved by the stock year-to-date, after profit guidance missed expectations and analyst’s consensus changed the stock to “hold”. The story was far more-stark for Domino’s Pizza, with that company missing even the lowest analyst estimate for full year net income, driving its share price down 6.52 per cent. China: Macroeconomic watchers had an eye-on Chinese fundamental data midday yesterday, as China’s National Bureau of Statistics released one of its big monthly data dumps. The monthly release of Retail Sales, Unemployment, Industrial Production and Fixed Asset Investment data has taken on graver significance in recent months, with trader’s combing through any piece of information that could glean an insight into the fundamental strength of a slowing Chinese economy. Yesterday’s release was on balance a poor one, adding to concerns that tariffs and cyclical factors are dragging on the Chinese economy. Despite this, traders largely ignored the news, swept up in the relief of ostensibly lower credit risk from the Turkey debacle – although the Yuan did maintain its affection towards the 6.90 mark. Aussie data: Australian fundamental data will centre on the household sector over the next 24-48 hours. It begins with the release of the Westpac Consumer Sentiment reading at 10.00AM, continues with Wage Price Index data later this morning, and concludes with Employment Data tomorrow. The wage growth figures will be the most pertinent for markets, given the RBA’s imploration that inflation and therefore interest rates will not increase until there are signs that Australian workers are getting a pay rise. Though it was missed by many in the thick of the Turkey panic at the end of last week, cash futures markets more-or-less priced out any more than a 50/50 chance of an interest rate hike from the RBA, following the release of the bank’s quarterly Monetary Policy Statement on Friday. While this market-dynamic remains, watch for an increasingly stifled AUD/USD, particuarly now that we’ve plunged below the 0.7300 handle. UK and the Pound: Better than expected labour market data was released out of the UK last night, ahead of the release of CPI figures tonight. The UK economy is one of the more curious situations for market participants presently, particularly as it relates to future interest rate settings amid ongoing Brexit drama. The implications appear to be weighing on sentiment and economic fundamentals, effectively forcing the BOE to admit recently that strong fundamentals will take a back-seat while an outcome to Brexit is decided. Activity in the pound has hence become of high interest in markets, especially this week, considering scheduled Brexit negotiations on Thursday: the GBP/USD has lost over 3 cents in less than a fortnight, presenting signs of being oversold, but apparently possessing little impetus to reverse this trend. Please note: This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  6. JasmineC

    Trader's View - APAC brief 10 Aug

    ASX yesterday: SPI futures have the ASX200 edging slightly higher this morning, following a day in which the Australian market challenged the significant 6300-handle once more. The strong activity perhaps came as somewhat of a shock to traders, given the humdrum session on Wall Street the night before, combined with the floating of several geopolitical risks. Some solid earnings reports set the foundations for the yesterday’s run, namely from financials stocks Suncorp and Magellan; but the real catalyst for the stronger ASX was a general boost to sentiment from a rally in Chinese equities, which added 2 per cent according to the blue chip CSI300 index. ASX prospects: In what was a slightly disappointing climax to the day, the ASX200 failed to close about 6300, indicating some reservations amongst investors about yesterday’s move. It isn’t the first time that the local market has failed to hold above that level, raising questions about the substance beneath these sorts of moves higher. So far, reporting season has delivered some respectable results, which — assuming if it continues — will give impetus for pushes higher. However, considering the vulnerability in bank stocks owing to tightening funding costs and slow credit growth, coupled with flatness in the materials space due to softer commodity prices and trade war fears, a sustainable move higher in the index must questioned and approached carefully. Aussie Dollar: The low implied volatility markets, which is at 7-month lows based by some measures, has boosted risk sentiment and supported riskier assets in the past several days. This dynamic was well demonstrated by the Australian Dollar, which saw a flow of speculative trading push the local unit to the very top of its range. The AUD/USD edged close to the top of its range during the Asian session, hovering around the 0.7440-mark for much of the day, and reaching highs above 0.7450. Although the move higher in the Aussie Dollar was slightly counterintuitive given global risks and the matter of unattractive yields, the price action was well within the currency’s recent range. Profit taking from speculative traders has presumably overnight irrespective of this, with the AUD/USD trading around 0.7375 at time of writing. North America: Wall Street dipped at the North American session’s close, receding for the second day and putting on hold its resolute climb towards record highs. US shares seems to be a little more sensitive to global risks at the minute, pushing traders into safe havens like US government debt, and driving benchmark 10 Year Treasury yields to 2.92%. Furthermore, it was industrial stocks and the US financials lead the market lower – a state of fairs manifesting most in the Dow Jones. In a silver lining to the night’s trade, the ever-strong NASDAQ held its line, coming within around 15 points of it all time highs, galvanized by renewed enthusiasm towards tech stocks. US CPI: Some of the bearishness in US markets last night may be attributable to positioning for the release of the week’s major economic announcement tonight: the release of US CPI data. Following on from the overnight release of US PPI figures, which revealed a below forecast number, traders will be digging into tonight’s inflation numbers for signs that the red-hot US economy is showing signs of significant price growth. Although the official CPI print isn’t the US Fed’s preferred inflation gauge, signs of an overheating economy in the form of rapid price growth will weigh on policy maker’s minds, particularly amid only gradual rises in US wages growth. Greenback: The US Dollar this morning is displaying considerable strength. According to the US Dollar Index, the greenback has wrestled through resistance at 95.40, to trade at 95.60 at time of writing. Currency markets have been awaiting this sort of move for several months, and though it’s too early to say if it will consolidate itself, conventional wisdom suggests it’s a matter of time before higher yields will drive the greenback higher across the board. Tonight’s CPI figures could be the spark that lights the fire, with a break of this resistance at 95.60 opening-up ~96.70 as the next stop. Data today: In other relevant economic data, both locally and abroad, global traders will be preparing for the monthly release of UK GDP data this evening, while locals will be keeping an eye on the RBA’s quarterly Monetary Policy Statement. The UK’s GDP data will be particularly interesting as it relates to the GBP, particularly the cable, which has come under heavy selling pressure following the BOE’s recent dovishness and heightened risks relating to a Brexit “no-deal”. The GBP/USD has burrowed below a rather firm trend channel overnight, and is flashing signs of being a little oversold: although the trend is irrefutably lower for the Pound, perhaps a bounce in the sterling is on the cards following tonight’s GDP release in a classic “buy the rumour sell the fact” scenario. Please note: This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  7. JasmineC

    Trader's View - APAC brief 9 Aug

    Trade war: Geopolitical ructions became the dominant theme late in North American trade, setting up a day for Asian markets distracted by trade-war developments and rising diplomatic tensions in other geographies. The heightened trade war anxieties were piqued by news that China would be slapping retaliatory tariffs of 25 per cent on $US16b worth of US imports, in response to the Trump administrations go-ahead earlier in the week to implement comparable tariffs on Chinese imports. The trade concerns were then exacerbated by news that the US would increase sanctions on Russia for its involvement in poisoning an ex-Spy in the UK. Both stories are fresh but add to already tense diplomatic relations between the US and China, and the US and Russia: expect the news to rattle Asian and European markets, which have proven far more vulnerable to geopolitical risks. US Indices: Wall Street has slipped in late trade during the North American session, during a day in which US indices traded relatively flat. The industrials laden and therefore trade-war sensitive Dow Jones has given up the most ground, staring down a close of -0.2 per cent. The benchmark S&P500 is still effectively flat, while the NASDAQ has held onto very modest gains, illustrating once-more that the all-conquering tech spacer is what underpins US share-market strength in the face of trade-conflict. US share were showing signs of a potential run toward the record levels set at the start of 2018, with the S&P coming as close as 13 points to that milestone. The inflamed trade-war tensions may put this ambition on hold, notwithstanding the record earning’s season on Wall Street. Oil: Oil prices have experience the most volatility overnight, courtesy of the increase in geopolitical risks, falling several per cent, even despite a lower than expected print in US crude oil inventories. Brent Crude is currently trading around the $US72.35-mark, stripping most of this week’s gains, as markets factor in the greater risk of a global economic slowdown, along with the possibility Russia may intervene in oil markets in response to new sanctions. The dump in oil prices does not bode well for equity markets, which have benefited from climbs in energy stocks in response to the oil rally. The ASX200 will certainly remain amongst the most vulnerable to this dynamic, with eyes now on the performance of the energy and materials sectors today. ASX: SPI futures are slipping as the morning unfolds, as prices in that market progressively fall as news about trade war risks develop. The Australian share market performed relatively well yesterday, adding 0.23 per cent to close at 6268. The closing price placed the ASX effectively in the middle of its recent range, with traders now acclimatising to some sideways trading. It is difficult to imagine that further gains are on the cards for ASX today amid this morning’s trade war developments, particularly given a gathering fall in commodity prices. Perhaps a good indicator of trader sentiment and market strength will be in how well support at around 6235 holds up today. CBA: The major catalyst for the ASX200’s little climb yesterday was the relief rally in the price of CBA shares, which added 2.63 per cent throughout the day. Although the bank’s results effectively ended its run of recorded profits — weighed down by the roughly $1.1b of outlays relating to regulatory costs and legal penalties — the earnings report appeared to reassure investors that the poor results could be pinned on transitory factors, and that the business fundamentals appear strong enough to justify buying at current levels. It will be a point of interest as the markets digests CBA’s earnings and await updates from the other major banks, how far a rally in bank stocks can go: there is certainly a lid on prices around the bank’s pre-Royal Commission levels and given the headwinds of a slack economy and weaker property prices, further climbs in bank stocks seem improbable. China: Chinese markets will likely take much of the attention of global markets today, considering the unwelcomed developments in the trade war. Activity in the Yuan will be closely watched, as it appears the PBOC are beginning to play a big part in supporting the weakening Chinese currency. Anywhere above or near the 6.90 level seems to be the line in the sand for Chinese policy makers, with stabilization measures quickly applied to currency markets when traders push the Yuan through that mark. A strong argument could be made that the actions of the PBOC indicate that Chinese officials won’t look to weaponize the Yuan in this trade war, who appear to be more worried for now about the issue of financial stability within the Chinese economy. RBNZ: The RBNZ kept interest rates on hold this morning. More to come tomorrow. Please note: This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
  8. Hi , At the moment we only provide this information at the end of each financial year. I do understand your concern and this will be passed on to our shares team as feedback for future consideration. Thanks Jasmine
  9. JasmineC

    Not chess sponsored?

    Hi and At the end of each financial year, a specific document will be provided via the online platform that details the Franked/Unfranked dividends as well as Franking credits and other income applicable on your account. I hope the above clarifies. Thanks Jasmine
  10. JasmineC

    Hybrids

    Hi , unfortunately we do not offer these convertible notes, thus you won't be able to find it on our platform. Are there any other shares or markets you are looking to trade? Cheers Jasmine
  11. JasmineC

    Franking Credits

    Hi , you will indeed be entitled for franking credits for any dividends received on your shares. Whilst they are not included in the daily statements, all details regarding franking credits will be available in your annual tax statement which will be sent out at the end of the tax year. I hope this will help. Cheers Jasmine
  12. JasmineC

    Daily FX Interest?

    Hi , please be advised that any positions on our Spot FX markets will be subject to overnight funding using the relevant TomNext bid/ask prices, plus IG's annual administration charge of 0.8%. All your open FX positions are automatically rolled over to the next settlement date so as to avoid physical delivery of the currencies in question, hence why you'll see interest charges on your account. This is calculated as Bet size * Relevant TomNext, irrespective of the prices you buy and sell at. The TomNext rate is a tradeable rate in its own right and acts as an interest rate differential between the two currencies you’re trading, and hence can change day on day. Since TomNext operates on a T+2 basis, settlement only takes place two business days after the trade date. Therefore a three-day interest charge will be applied on your positions if you held a position through Wednesday. This is because the delivery date would change from Friday to Monday, which is why the rollover on Wednesday requires three days' worth of interest and not just one day. For more information, please visit our Help and Support page on the link below where we explain how funding for forex positions is calculated: https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/fees-and-charges/how-is-funding-on-forex-positions-calculated
  13. JasmineC

    Daily FX Interest?

    Hi , please be advised that any positions on our Spot FX markets will be subject to overnight funding using the relevant TomNext bid/ask prices, plus IG's annual administration charge of 0.8%. All your open FX positions are automatically rolled over to the next settlement date so as to avoid physical delivery of the currencies in question, hence why you'll see interest charges on your account. This is calculated as Bet size * Relevant TomNext, irrespective of the prices you buy and sell at. The TomNext rate is a tradeable rate in its own right and acts as an interest rate differential between the two currencies you’re trading, and hence can change day on day. Since TomNext operates on a T+2 basis, settlement only takes place two business days after the trade date. Therefore a three-day interest charge will be applied on your positions if you held a position through Wednesday. This is because the delivery date would change from Friday to Monday, which is why the rollover on Wednesday requires three days' worth of interest and not just one day. For more information, please visit our Help and Support page on the link below where we explain how funding for forex positions is calculated: https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/fees-and-charges/how-is-funding-on-forex-positions-calculated
  14. Hi all, I just want to reinstate 's comment above, please follow the community guidelines and use appropriate language when posting. A few comments have been removed and we thank you for your help in maintaining a meaningful discussion. Happy trading.
  15. Hi , Sorry for the delay, please find this week's dividend adjustment here. Cheers Jasmine
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