Australian market expected to open higher 09/12/19

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OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract expected to open up 35 points.

The U.S. job market strengthened in November, as employers added 266,000 jobs and unemployment matched a 50-year low, fueling the economic expansion.

Global investors likely have a long wait before the Saudi oil giant’s expensive shares are priced at a more normal level.

Overnight Summary

Market Quotes by TradingView

Each Market in Focus

Australian Market

Despite a second straight day of gains for Australian shares, the local market still logged its sharpest weekly decline in two months. Settling at 6707.0, the S&P/ASX 200 was up 0.4% for the day but down 2.0% for the week.

Healthcare and technology shares led broad gains, with only the materials sector lower for the day as Boral retreated 6.3% after it uncovered financial irregularities in its North American windows business.

US Market

U.S. stocks rose after a surprisingly upbeat monthly jobs report signalled strength in the U.S. economy, offsetting some of the jitters about trade that rattled investors earlier in the week.

The Dow Jones Industrial Average advanced 337.27 points, or 1.2%, to 28015.06. The S&P 500 added 28.48 points, or 0.9%, to 3145.91, and the Nasdaq Composite rose 85.83 points, or 1%, to 8656.53.

Commodities

Gold futures settled sharply after the U.S. report on November employment came in better-than-expected, with gains last month of 266,000 new jobs, marking the biggest monthly gains since January and reaffirming the health of the domestic economy.

Oil Futures

U.S. benchmark oil prices ended at their highest in 11 weeks, closing up 1.3% at $59.20 after OPEC and other top producers including Russia announced extra production cuts totalling 500k bpd in an effort to tighten global supplies.

Forex

EUR/USD erased the bulk of this week’s strong rise, extending falls after today’s above-forecast U.S. sentiment data followed earlier stellar U.S. jobs data.

EUR/USD weakened 0.4% to 1.1058, its lowest since the start of this week and well below Wednesday’s one-month peak of 1.1114. The euro also broke below chart support at 1.1052, the 50-day moving average.

European Markets

Overseas, the benchmark Stoxx Europe 600 index climbed 1.2%. U.K. markets remained volatile ahead of a general election next week.

The FTSE 100 rallied 1.2% on Friday, lifted by the U.S. jobs data and speculation that Prime Minister Boris Johnson’s Conservative Party will come out on top in the vote.

Such an outcome would reduce uncertainty around the U.K.’s withdrawal from the European Union.

Asian Markets

In Asia, U.S.-China trade talks remain in the spotlight for markets ahead of the Dec. 15 deadline for new tariffs on consumer goods to take effect.

The Shanghai Composite Index closed up 0.4%, while the Hong Kong and South Korean gauges rallied just over 1%.

Hong Kong’s Hang Seng extended its early gains after China said it is working to exempt some U.S. pork and soybean imports from punitive tariffs, further renewing hopes on the trade front.

Electronic-component suppliers continued their rally since Thursday as their operations tend to be more susceptible to trade tensions.

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