Markets Mixed Friday, But Higher For the Week
US stocks closed generally higher, ahead of another busy week of corporate earnings. Asian stock markets ended flat, ahead of the G-20 on the weekend. The Chinese market is testing key overhead resistance from a down-trend line that has been in place since mid-2009. European stocks finished lower on Friday, but up for the week. German markets remain at fresh 52-week highs. The ASX is likely to trade flat, as commodities prices were mixed. There is major US economic data due out this week, including durable-goods orders and gross domestic product.
The SPI Futures is below the key resistance level of 4720 and the ASX is set to open flat as the SPI Futures closed flat at 4,645. The key levels for our index this week are 4700 and 4600. M&A activity continues to drive specific stocks. The ASX is set to trade flat today, with little direction from Europe and the US, and reporting from some Aussie bank majors due later in this week. Options volatilty is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.
US Markets
US stocks closed mixed Friday, ahead of another busy week of corporate earnings. There is major US economic data due out this week, including durable-goods orders and gross domestic product. US stocks fluctuated as improving corporate earnings offset concerns over the prospect of a “currency war” as central banks across the globe race to devalue their domestic curriencies. Nearly 75 percent of the S&P 500 companies that have reported 3Q results thus far this earnings season have topped analysts’ estimates, but investors remain concerned over currencies and the weak economic backdrop. Technology stocks were boosted by encouraging earnings from stocks like Riverbed Technology, which makes products that reduce the load on networks (shares surged 18%), Compuware, CA Inc. and Amazon.com also reported earnings that beat analyst estimates. However Amex shares fell as they reported weak demand for new loans, and Verizon disappointed over slowing wireless subscriber growth. Schlumberger (shares up 5.4%) boosted the energy sector after the oilfield services company’s 3Q earnings more than doubled. The Energy sector (up 0.7%) and Consumer Discretionary sector (up 0.6%) supported the market, while the Materials sector (down 0.7%) weighed. The Dow and the S&P 500 closed up for a third consecutive week, with the Dow up 0.6%, while the S&P 500 gained 0.6% and the tech-heavy Nasdaq added 0.4% for the week. The Dow closed down 0.1% (or -14 points) at 11,147, while in the broader market the S&P 500 index was up 0.2% (or 2 points) at 1,183 and the Nasdaq ended up 0.8% (or 19 points) at 2,479.
European Markets
European stocks finished lower on Friday, but were up for the week. In London the market declined, led by the mining companies, after analyst downgrades. On a positive note Betfair surged 19 percent on its first day of trading after raising $330 million in its London IPO. German markets remain at fresh 52-week highs. The major issue for discussion at the G-20 was the debate on trade concerns over possible exchange-rate imbalances. The financiers at the G-20 did agee to “move towards” market determined exchange rates that “refrain from competitive devaluations of curriencies”. German Economy Minister Rainer Bruederie said that the US Federal Reserve is heading the “wrong way” by “adding liquidity” with monetary easing, as it amounts to a manipulation of the dollar. For the week German markets rose 1.7 percent, the UK’s FTSE gained 0.7 percent and the French market rose 1.1 percent. In London the FTSE 100 index closed down -0.3% (or -17 points) at 5,741, the German DAX was flat (or down -5 points) at 6,605, while in France the CAC was down -0.3% (or 8 points) at 3,869.
Asian Markets
Asian stock markets ended flat. Japanese investors were cautious due to the strength of the yen, ahead of the G-20 meeting and this week’s earnings reports. Technology shares advanced, as LG posted better-than-expected earnings. China’s Shanghai Composite was down 0.3% and Hong Kong’s Hang Seng Index edged down 0.6%. Miners and banking stocks led Chinese markets lower on continued profit-taking. Also weighing on banks were concerns over bad loans in the property market following the recent tightening measures. The Chinese market is testing key overhead resistance that has been in place since mid-2009. In China the SSE Composite closed down -0.3% at 2,975, while in Hong Kong the Hang Seng Index was down -0.6% at 23,518 and in Japan the Nikkei 225 Index was up 0.5% at 9,426.
Commodities
The Dollar Index was flat at 77.47 on a steady Euro, while the Australian Dollar last traded lower at 98.25.
Commodities were mixed. Benchmark crude NYMEX for December delivery was flat (or up $US0.03) to settle at $US80.59. Copper prices rose: Copper for December delivery was up 0.4% (or 1.7 cents) at $US3.7915. Gold prices backed off record highs, and are now around the key $US1,380 level. December gold was down -$8.70 at $US1,317.
Key News International Drivers Today
JAPAN – Exporters weigh as Yen at 15-years highs.
Markets Overview
|
Market |
Movement |
|
The Dow Jones Industrial Average |
Down 0.1% (or -14 pts) at 11,132 |
|
The S&P 500 |
Up Marginally 0.2% (or 2 pts) at 1,183 |
|
The Nasdaq |
Up 0.8% (or 19 pts) at 2,479 |
|
|
|
|
The FTSE 100 |
Down -0.3% (or -17 pts) at 5,741 |
|
The German DAX |
Flat (or down -5 pts) at 6,605 |
|
The Fench CAC |
Down -0.3% (or down -8 pts) at 3,869 |
|
|
|
|
The Dollar Index |
Flat at 77.47 |
|
The Australian Dollar |
Last traded at 98.25 |
|
The Commodities Index |
up 0.6% at 297.2 |
|
|
|
|
Crude Oil Futures |
Flat at $80.59 |
|
Gold Futures |
Down $8.70 at $1,317 |
|
Copper Futures |
Up 0.4% at $3.7915 |
|
SPI Futures |
Flat at 4,645 |
|
|
|
|
|
|
|
Market |
Movement |
|
SSE Composite (China) |
Down -0.3% at 2,975 |
|
Hang Seng Index (Hong Kong) |
Down -0.6% at 23,518 |
|
Nikkei 225 Index (Japan) |
Up 0.5% at 9,426 |
ASX News Today
The SPI Futures is below the key resistance level of 4720, and the ASX is set to open flat as the SPI Futures closed flat at 4,645. The key levels for our index this week are 4700 and 4600. M&A activity continues to drive specific stocks. The ASX is set to trade flat today, with little direction from Europe and the US and reporting from some Aussie bank majors due later in the week. Options volatilty is subdued at the moment, which gives investors access to “cheap” protection, so investors may consider taking this opportunity to protect their portfolios.
BHP- BHP chairman Jac Nasser says BHP would pull out of a $US40 billion bid for Canada’s Potash Corp if it proves too expensive. While Saskatchewan’s premier says the province will not support the bid.
FGL- Fosters says the Australian wine industry is moving closer towards the end of an oversupply of grapes and wine.
MAP- MAp says Sydney Airport has increased its earnings by 14.2 per cent so far in 2010 on strong passenger growth, commercial expansion and cost control.
STO- Santos now has the Australian government’s environmental impact approval for its proposed gas-export terminal.
TSM- ThinkSmart, the computer and office equipment financier, has launched its “Infinity” consumer finance product in the UK. Shares jumped 10%.
WPL- Woodside says 3Q production volumes grew by 5 percent, but sales revenue was down 4 percent on the previous quarter. They are evaluating the cost and schedule of the $13 billion first phase of its Pluto LNG project.
Macarthur Coal (MCC) September Quarterly Report
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ASX – to open flat
US ADRs – Mixed
Oil Stocks Index up 0.6%
Head of Research
