Stock Market Analysis
Consumers not so Confident in the US; Negative Lead for ASX
U.S. stocks took a breather despite further good earnings reports from Dow component DuPont and Cummins. Consumer confidence has hit a five-month low due to the poor employment outlook. Our market is likely to see some profit taking today, investors should take out some protection.
The SPI Futures is above the key level of 4400 the ASX is set to open higher as the SPI Futures closed up 0.4% (or 19 pts) at 4,490. Miners, Energy and Consumer Discretionary stocks will likely see profit-taking today. Key levels today are 4550 and 4400, with pivot around 4500. M&A activity continues to drive specific stocks.
US Markets
The S&P 500 remains above the key 1100 level, but consumer confidence fell in July to its lowest point since February, hurt by concerns about the job market, according to a report from the Conference Board. DuPont (up 3.6 percent) supported the Dow after the company raised its forecast for 2010 earnings well above expectations, while Cummins (up 2 percent) also raised its full-year forecast. But steelmakers painted a gloomier outlook, with AK Steel saying it was cutting production capacity to match weak demand. while US Steel (down 6.4 percent) reported a net loss that missed analysts expectations.
The broader S&P 500 is trading just below its 200-day moving average after crossing above it on Monday (as seen on the chart below). Sectors (in order) that dragged the market lower included: Consumer Discretionary Materials, Industrial and Energy, all down over 0.6 percent. The Dow closed up marginally 0.1% (or 12 points) at 10,538, while in the broader market the S&P 500 index down marginally -0.1% (or -1 points) at 1,114 and the tech-heavy Nasdaq ended down -0.4% (or -8 points) at 2,288.
European Markets
Asian Markets
Commodities
The Dollar Index up marginally 0.1% at 82.15 on higher Euro, while the Australian Dollar last traded at 90.21. Commodities were generally lower.
Oil prices eased as the storm threat for oil operations in the Gulf of Mexico evaporated. The benchmark crude NYMEX for September delivery was down -0.5% (or $US0.39) to settle at $US77.11. Copper prices are trading above the key $US3.00 a pound, Copper for September delivery delivery was up marginally 0.0% (or 0.1 cents) at $US3.2055 a pound. Gold was lower, with August gold was down -2.1% at $US1,162.80 an ounce.
Key News International Drivers Today
US – S&P 500 companies continue to report earnings this week.
EU – M&A activity. Bank shares rose after the Basel Committee on Banking Supervision relaxed some of its proposed capital and liquidity rules.
CHINA – Central bank happy with the slowing economy. JP Morgan says equities starting to look attractive.
JAPAN – companies start to report earnings this week.
Consumers Not so Confident in the US; Negative Lead for ASX
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Market |
Movement |
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The Dow Jones Industrial Average |
Up Marginally 0.1% (or 12 pts) at 10,538 |
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The S&P 500 |
Down Marginally -0.1% (or -1 pts) at 1,114 |
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The Nasdaq |
Down -0.4% (or -8 pts) at 2,288 |
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The FTSE 100 |
Up 0.3% (or 15 pts) at 5,366 |
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The German DAX |
Up Marginally 0.2% (or 13 pts) at 6,207 |
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SSE Composite (China) |
Up 0.8% (or 0 pts) at 38.0 |
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The Dollar Index |
Up Marginally 0.07% at 82.15 |
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The Australian Dollar |
Last traded at 90.01 |
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The Commodities Index |
Down -0.83% at 264.5 |
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Crude Oil Futures |
Down -0.5% at $77.11 |
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Gold Futures |
Down -2.11% at $1,162.80 |
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Copper Futures |
Up Marginally 0.02% at $3.2055 |
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SPI Futures |
Up 0.4% (or 19 pts) at 4,490.0 |
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Market |
Movement |
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SSE Composite (China) |
Down -0.5% at 2,575 |
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Hang Seng Index (Hong Kong) |
Up 0.6% at 20,973 |
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Nikkei 225 Index (Japan) |
Down Marginally -0.1% at 9,497 |
ASX News Today
The SPI Futures is above the key level of 4400 the ASX is set to open higher as the SPI Futures closed up 0.4% (or 19 pts) at 4,490. Miners, Energy and Consumer Discretionary stocks will likely see profit-taking today. Time to protect positions. Key levels today are 4550 and 4400, with pivot around 4500. M&A activity continues to drive specific stocks.
ALZ- Australand the property developer has posted 1H10 net profit up 127 percent, saying it is on track to achieve its full year earnings guidance.
ANZ- ANZ Bank may need to raise $4 to $6 billion to fund acquisitions, including a bid for the Korea Exchange Bank, according to Macquarie Equities.
CEY- Centennial Coal says June quarter production is 14 percent higher than the previous quarter and July 2010 production has started well and declares a final dividend of $0.04/share.
EMX- Energia Minerals the uranium explorer reported its maiden resource estimate for its wholly owned Nyang project in WA. Shares jumped 23%.
IAG- Insurance Australia says it expects to report a drop in annual profit in fiscal 2010 of around 50%, but expects an improved performance in FY11.
MCC- Macarthur Coal Ltd has abandoned a $110 million deal by which it would have bought out CITIC Resources’ interests in a joint venture. Shares fell 3.7%.
NCM- Newcrest has signed a non-binding deal to take at least a 7.1 per cent stake in British firm Sumatra Copper and Gold.
OSH- Oil Search the energy producer reported falling production in its 2Q10 as a result of a processing plant shut down and declining output from its ageing oil fields.
WBC- Westpac says it remains focused on its Australasian business, and is not about to embark on a strategic push into Asia.
WES- Wesfarmers said coal production at its Premier mine near Collie in WA for the June quarter was down 7.6 percent due to lower demand from state electricity generator Verve Energy.
RIV – Riversdale Mining Ltd – June Quarterly Report
LGL – Lihir – June Quarterly Report
WHC – Whitehaven Coal – June Quartely Activities Report
Market Summary
US & UK/Europe – lower.
US ADRs – Mixed!!!…
ANZ up 0.3% & NAB up 0.3%
NEM down 4.0%, JHX up 1.4%, NWS down 1.3%
Gold Stocks Index down 3.0%
Oil Stocks Index down 0.4%
Head of Research
Tags: Asian Markets, ASX, ASX News, BHP, European Markets, mining, Nikkei, S&P500, spi, Stock Market Analysis, stockmarket, trading, US Market wrap
