Market lull ahead of US non-farm payroll numbers
There was little action in global markets overnight, but what did emerge was in line with expectations. Arguably, the most important development was the Bank of England’s decision to keep rates on hold, but that was anticipated.
The FTSE 100 appeared to respond positively to the Bank of England’s decision, gaining 0.5%.
Perhaps it was BOE Governor Mark Carney’s rhetoric that prompted a significant fall in the British pound, as he indicated the likelihood of near-term rate rises were slight given the uncertainty that surrounds the Brexit transition and the current state of the economy.
Markets were also relatively flat in mainland Europe with the DAX the main mover as it came off nearly 0.3% to close at 11,627 points. The Paris CAC 40 was flat, closing at 4794 points.
Both the Dow and the NASDAQ were relatively flat, finishing just shy of the previous day’s close.
On the commodities front, there was a strong rally in gold in early trading as it increased from the previous day’s close of US$1208 per ounce to US$1228 per ounce. While it lost some of this momentum in afternoon trading, it is still up 0.7%.
The oil price was down 0.5%, looking to finish the week in a range between US$53 per barrel and US$54 per barrel.
Metals markets affected by Philippines government decision
Base metals were mixed with nickel and lead gaining ground, while zinc and copper came off slightly after what could only be described as a stellar week.
The Philippines government’s decision to order suspension of mining, predominantly in relation to nickel producers in the country is still to play out fully. There is the potential for nickel to rally on the back of this development, and this was evidenced in yesterday’s strong share price support for Western Areas and Independence Group.
Aside from commodities, one of the biggest moves in the last 24 hours has been the strengthening of the Australian dollar against the US dollar as it increased more than 1% from the previous day’s close of US$0.758 to hit a high of US$0.769, and there are signs that this run could continue.
This was triggered by yesterday’s trade figures which featured an all-time record trade surplus.
It should be noted that broker projections and price targets are only estimates and may not be met. Also, historical data in terms of earnings performance and/or share trading patterns should not be used as the basis for an investment as they may or may not be replicated. Those considering this stock should seek independent financial advice.
When the experts at Next Investors have a stock pick, it may pay to listen.
The Next Investors have been investing in ASX small cap stocks for years, with their best small cap picks yielding returns of 1,200%, 1,120%, 900% and 678%.
They have just revealed their hand-picked, FY2021 stock portfolio of high conviction long-term investments.
Click the link below to see what they are currently investing in.
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.