The miners are set to push the ASX higher this morning, with ASX futures up 0.5% at 7,407 at 6.30am AEDT.
Iron ore reversed its downward trend as debt fears eased over troubled Chinese property developer China Evergrande Group. The developer reportedly made debt payments, easing fears about a slump in the economically-sensitive property sector.
Wall St was mixed.
Here’s what we saw:
- The Aussie dollar fell from highs near US73.20 cents to lows near US72.86 cents and was near the lows in afternoon US trade.
- Global oil prices were 0.3% higher on Thursday. OPEC’s monthly report said it expects oil demand to average 99.49 million barrels per day (bpd) in the fourth quarter of 2021, down 330,000 bpd from last month's forecast. OPEC cited lower demand in China and India.
- The Brent crude price rose by US23 cents or 0.3% to US$82.87 a barrel.
- The US Nymex crude price rose by US25 cents or 0.3% to US$81.59 a barrel.
- Base metal prices rose by as much as 3.8% on Thursday with aluminium up the most.
- Nickel was flat.
- Zinc fell 0.7%.
- The gold futures price rose by US$15.60 or 0.8% to U$1,863.90 an ounce.
- Spot gold was trading near US$1,862 an ounce at the US close.
- Iron ore rose by US$4.70 or 5.3% to US$94.20 a tonne.
Australian market
Yesterday’s employment report showed that employment fell by 46,300 taking the unemployment rate up to 5.2% from 4.6% previously.
As a key plank of the Reserve Bank’s monetary policy, the current data will not go down well.
It is certainly something to keep an eye on.
On the upgrade front, Citi has upgraded Coles to buy and maintained buy ratings for Harvey Norman and Super Retail.
"Retail has benefitted significantly over the last 18 months from travel restrictions, lockdowns and government stimulus," said Citi analysts Adrian Lemme and James Wang.
On the downgrade front, Citi has downgraded Metcash and JB Hi Fi to neutral, following recent outperformance.
Citi believes the trend in retail will be mixed moving forward as the world navigates a "slower path to ‘normalisation’ in the economy", including a slow recovery for travel expenditure, elevated COVID cases with the easing of restrictions and robust house prices along with higher house prices that support spending.
"Looking further into FY23 and beyond, we see the work from home trend sustaining, which will lift longer-term demand in grocery and home-related categories.
“We believe there is little structural improvement factored into consensus forecasts and market pricing."
Saxo’s most popular traded stocks
Saxo Markets took a look at their client's trading activities over the past year to find out what the most traded stocks are in Australia, and how trading trends for Saxo Markets' Australian clients compare to the global market.
Saxo looked back through a host of datasets to pinpoint the top-performing stocks in the year to date based on geography, sex, and age range and explored the most traded stocks by search engine volumes to discover whether search interest correlates to how retail traders are investing down under.
Most traded stocks globally
Most traded stocks in Australia
Search trends
Australian indices
- ASX 200 rose 0.17% to 7,394.80.
- ASX24 futures rose 0.4% to 7,403.
- S&P/ASX Small Ordinaries rose 0.20% to 3,543.20.
- All Ordinaries rose 0.17% to 7,713.80.
US markets
The bond market was closed yesterday due to Veterans Day, however, on Wednesday US 10-year yields rose by 13 points to near 1.57%. US 2-year yields rose by 10 points to near 0.52%.
Sharemarkets were mixed yesterday, with materials, energy and technology sectors driving the gains.
As reported yesterday, Walt Disney had a shocker with shares falling 7.1% after the latest earnings update disappointed investors.
Shares in Rivian Automotive rallied a further 22.1% on its second day of trade.
Shares in Tapestry Inc (NYSE:TPR) rose 8.4% after the Coach handbag maker lifted its annual sales forecast.
The main US talking point is inflation, which could have ramifications for Australia.
USA experienced its biggest jump in inflation in more than 30 years, with fears this could cause global price pressures that cause havoc here, forcing interest rates to rise either by the RBA’s hand or via banks making their own interest rate decisions (which we are seeing already in terms of fixed rates).
The price of goods is being pushed higher by supply chain bottlenecks, higher petrol prices and labour shortages.
US indices
- Dow Jones fell 0.4% to 35,921.23.
- S&P 500 rose 0.1% to 4,649.27.
- Nasdaq rose 0.5% to 15,704.28.
European markets
Europe was firmer on Thursday, led by a 3.7% gain in the mining sector.
Prices of base metals, including iron ore, rose after Chinese developer Evergrande avoided default.
Anglo American was the best performer in the mining sector, jumping 5.9% after Russia’s Alrosa, posted a profit jump and flagged a strong recovery in global diamond demand.
Swiss chemical company Sika rose 10.9% to record highs after agreeing to buy construction chemicals maker MBCC in a US$6 billion deal.
In London, trade shares in Rio Tinto rose 3.4% while BHP shares rose 3.9% after receiving approval for its net-zero emissions strategy.
Goldman Sachs (NYSE:GS) believes Euro stocks will continue to trend higher due to low interest rates, resilient earnings recovery and cheap valuations.
“We retain a positive outlook on European stocks for 2022,” strategists led by Sharon Bell said in a note.
The bank said that Europe equity now looked cheaper than at the outset of 2021 and “represents good value versus the US and excellent value versus other assets”.
European indices
- STOXX 600 rose 0.32% to 485.29.
- German Dax rose 0.1% to 16,083.11.
- UK FTSE rose 0.6% to 7,384.18.