4. ASX to open flat this morning: The ASX200 is set-up for a practically flat open this morning, with SPI Futures pointing to a 6-point gain for the index. It’ll back up what was a strong day yesterday for the index, which managed to rally 1.35 per cent, in a thin day’s trade. The gains were very broad based, with 86.5 per cent of stocks higher for the session, and every sector finishing in positive territory. The financials sector carried most of the load, rebounding from Monday’s big losses.
5. Aussie data disappoints: Australian economic data, and the accompanying analysis, was negative yesterday. ANZ Consumer Confidence figures were released, and revealed a drop-in consumer sentiment in the Australian economy last week. The dynamic was largely attributed to the effects of the current bushfire crisis in Australia. The analysis supported another research piece released by Goldman Sachs yesterday, that suggested that the bushfires ought to wipe 0.3 per cent off GDP in the final quarter of 2019 and the first quarter of 2020.
6. Australian Dollar drops: The Australian Dollar tumbled in the past 24 hours, largely due to concern about continued weakness in Australian consumption. The currency was the biggest laggard amongst G10 currencies, falling over 1 per cent, as traders upped their bets that the RBA will be forced to cut interest rates next month. The price action in the AUD/USD saw the pair break below its much watched 200-day EMA, an indicator that has provided strong technical resistance in the past.
7. USD climbs on services PMI beat: A stronger USD was also responsible for the sell-off in the AUD. The greenback managed to reclaim some of its recent losses, after the release of US ISM Non-Manufacturing PMI data printed stronger than expected overnight. The services sector indicator was shown to have expanded to a 55.0 reading last month, beating the forecast figure of 54.5, and allaying some of the concerns elicited by last week’s US manufacturing PMI numbers that business conditions in the US economy are deteriorating.
8. Market Wrap