Overnight: Broken Record, Records Broken

Ongoing positive momentum for equities, both locally and internationally, suggests fresh record highs are next. February reporting season anyone? 

World Overnight
SPI Overnight (Mar) 7044.00 + 36.00 0.51%
S&P ASX 200 7064.10 + 22.30 0.32%
S&P500 3329.62 + 12.81 0.39%
Nasdaq Comp 9388.94 + 31.81 0.34%
DJIA 29348.10 + 50.46 0.17%
S&P500 VIX 12.10 – 0.22 – 1.79%
US 10-year yield 1.84 + 0.03 1.49%
USD Index 97.64 + 0.60 0.62%
FTSE100 7674.56 + 64.75 0.85%
DAX30 13526.13 + 96.70 0.72%

Greg Peel is still on holidays. In the meantime, Jessica Amir from Bell Direct is providing a snapshot of insights and developments from overseas markets overnight.

By Jessica Amir, Bell Direct

Despite Australia’s intense environment, the Australian share market looks set to extend its record run following strong global leads.

US and European equities rose to new heights on Friday with China’s industrial production rising 6.9% over the year, which is more than expected. The tiger economy’s GDP grew 6.1% in 2019, matching forecasts.

The Aussie futures are eyeing a 0.5%/36-point lift at the open. Last week, the ASX200 rose 0.3%/22 points on Friday, rising 1.95% over the week, ending at 7,064 points. Month to date the index added 5.9%, which is its best monthly gain since July 2016, even though the month has not wrapped up.

With profit season to kick off here next month, and the looming US presidential election and phase two of the trade deal unknown, we are expecting uncertain times and volatility, with late cycle sectors and non-discretionary stocks to continue to outperform as rates drop to stimulate our sluggish economy while property values rise.

On Friday in the US, the blue-chip index the Dow Jones rose 0.2%/50 points, the S&P500 rose 0.4% closing at 3,330 points, while Nasdaq advanced 0.3%. Over the week, the Dow rose 1.8%, the S&P500 added 2% and the Nasdaq rose 2.3%.

Across the Atlantic, European stocks closed higher; with the Stoxx 600 up 0.96%, UK’s FTSE rising 0.85%, the French CAC lifting 1.02% and the Germany DAX adding 0.72%.

Gold is steady US$1,560 an ounce.

Oil is also steady at US$58.54 a barrel.

Iron ore trades 0.28% higher at US$94.81 a tonne

Australian dollar is buying 68.73 US cents.

What else to watch today?

  • Sydney Airports. It reports its December 2019 sales.
  • Nufarm, following its price downgrade by Bell Potter, which dropped its 12-month price target to $5.45 from $5.80.
  • Amcor, following Credit Suisse upgrading the stock by 4.8%, with a 12-month price target of $16.25.
Spot Metals,Minerals & Energy Futures
Gold (oz) 1556.70 + 3.40 0.22%
Silver (oz) 18.00 + 0.08 0.45%
Copper (lb) 2.83 – 0.00 – 0.04%
Aluminium (lb) 0.81 + 0.00 0.28%
Lead (lb) 0.90 – 0.00 – 0.52%
Nickel (lb) 6.28 + 0.08 1.21%
Zinc (lb) 1.10 + 0.02 1.46%
West Texas Crude 58.54 + 0.02 0.03%
Brent Crude 64.85 + 0.23 0.36%
Iron Ore (t) futures 95.75 + 0.50 0.52%
BPT BEACH ENERGY Downgrade to Hold from Accumulate Ord Minnett
DHG DOMAIN HOLDINGS Downgrade to Sell from Neutral UBS
FMG FORTESCUE Downgrade to Hold from Buy Ord Minnett
FXL FLEXIGROUP Upgrade to Buy from Neutral UBS
IGO INDEPENDENCE GROUP Downgrade to Lighten from Hold Ord Minnett
IPL INCITEC PIVOT Upgrade to Equal-weight from Underweight Morgan Stanley
MFG MAGELLAN FINANCIAL GROUP Downgrade to Underperform from Neutral Macquarie
MOZ MOSAIC BRANDS Downgrade to Hold from Add Morgans
MP1 MEGAPORT Downgrade to Hold from Accumulate Ord Minnett
Downgrade to Neutral from Buy UBS
MTS METCASH Upgrade to Neutral from Underperform Credit Suisse
OGC OCEANAGOLD Upgrade to Buy from Accumulate Ord Minnett
ORE OROCOBRE Downgrade to Sell from Hold Ord Minnett
PDL PENDAL GROUP Downgrade to Hold from Add Morgans
PRU PERSEUS MINING Upgrade to Outperform from Neutral Macquarie
Downgrade to Underperform from Outperform Credit Suisse
PTM PLATINUM Downgrade to Underperform from Neutral Macquarie
QBE QBE INSURANCE Upgrade to Outperform from Neutral Credit Suisse
SBM ST BARBARA Upgrade to Buy from Accumulate Ord Minnett
STO SANTOS Downgrade to Hold from Add Morgans
SUL SUPER RETAIL Downgrade to Hold from Accumulate Ord Minnett
WHC WHITEHAVEN COAL Upgrade to Hold from Lighten Ord Minnett
Greg Peel

About Greg Peel

Greg Peel joined Macquarie Bank in 1986 and acquired trading experience in equities, currency, fixed income and commodities derivatives, ultimately being appointed director of equity derivatives trading. He later published In With The Smart Money (a plain English guide to the mysterious world of financial markets and derivatives) and acted as a consultant to boutique investment funds. In 2004 Greg joined FNArena as a contributing writer. He is now a director and principal of the company. Greg compliments the journalistic background of the FNArena team with lengthy experience as a financial markets proprietary trader.

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