Australian market expected to open higher 16/10/19

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OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract expected to open up 52 points.

Goldman Sachs’s third-quarter earnings fell as the market turned against some of the firm’s stockholdings and new initiatives took time to yield positive results.

Global growth is expected to fall to 3% this year, according to new IMF estimates. The IMF pointed to rising trade barriers that have stunted manufacturing and investment around the world.

Overnight Summary

Market Quotes by TradingView

Each Market in Focus

Australian Market

Australian shares finished the day slightly higher. Bouncing back from initial weakness, the S&P/ASX 200 edged up 0.1% to 6652.0, its
seventh gain in eight sessions. Gains were broad in Australia, led by utilities and health care, though the market was held back by weakness in energy and mining stocks.

US Market

U.S. stocks climbed intraday as investors cheered strong results from banks and health-care companies at the unofficial start of the third-quarter earnings season. The outlook for profits had dimmed in recent months, with Wall Street analysts lowering earnings expectations for all 11 sectors of the S&P 500.

UnitedHealth Group, Johnson & Johnson and JPMorgan Chase – all components of the Dow Jones Industrial Average – kicked off the reporting period with a shot of optimism. Goldman Sachs Group shares also climbed, despite a mixed report.

Those four stocks contributed nearly 180 points to the blue-chip index, which climbed 290 points, or 1.1%. The S&P 500 rose 1.2%, led by the health-care sector. The Nasdaq Composite added 1.4%.

Commodities

Gold prices declined to mark their lowest settlement month to date, as investors awaited clarity on U.S.-China trade talks and as earnings season starts on a positive note.

Gold for December delivery on Comex fell $14.10, or 10.9%, to settle at $1,483.50 an ounce, with prices for the most-active contract logging their lowest settlement since Sept. 30, according to FactSet data. December silver gave up 32.6 cents, or 1.8%, to finish at $17.384 an ounce.
In other commodity markets, December wheat prices fell 4 cents to $5.07.

Oil Futures

Oil futures were under pressure, posting a loss for a second session in a row, as a lower economic growth forecast from the International Monetary Fund and a recent round of weak data out of China fueled worries over energy demand.

West Texas Intermediate crude for November delivery on the New York Mercantile Exchange fell 78 cents, or 1.5%, to settle at $52.81 a barrel, while December Brent crude lost 61 cents, or 1%, to end at $58.74 a barrel on ICE Futures Europe. Both crude benchmarks settled around 2% lower Monday.

Forex

The British pound climbed 1% against the U.S. dollar earlier in the day, reaching its highest level in about four months and putting it on course to wipe out losses from earlier this year.

Shares in the region’s banks – led by Ireland’s AIB Group and the U.K.’s Lloyds Banking Group – and in property developers such as Hammerson PLC were also buoyed. The WSJ Dollar Index recently was down 0.09% at 91.34.

European Markets

European shares closed in positive territory, though a rise in sterling hit the FTSE 100, as Wall Street heads higher on cautious trade optimism and a generally good showing in quarterly results from U.S. banks.

The Stoxx Europe 600 gained 1.1%, the DAX was up 1.1% and the CAC-40 advanced 1%, though London’s blue-chip index was 0.03% lower as sterling rose 1% against the dollar and 0.9% against the euro on reports of tentative progress in the U.K.’s talks to leave the EU.

Asian Markets

In Asia, Chinese stocks fell as fresh economic data added to concerns about weaker growth prospects and the government’s ability to strike a trade agreement with the U.S.

The Shanghai Composite gauge dropped 0.6% as official data showed inflation reached a near six-year high last month, driven by rising pork prices. This comes amid signs of slowing growth and trade tensions for the world’s second-largest economy.

Japanese stocks end broadly higher, with auto and pharmaceutical stocks rising more sharply, thanks to some progress in U.S.-China trade talks.

Hong Kong shares fell, in line with declines in mainland stocks, after China’s producer-price inflation slowed further in September. The Hang Seng Index closed 0.1% lower at 26503.93. The weaker PPI data added to concerns over China’s economic growth ahead of the release of GDP and other economic data on Friday.

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