Meltdown, recovery and outlook

By Trevor Hoey. Published at Apr 7, 2017, in Features

It was a tale of two sessions in the US following the previous day’s meltdown which mainly came off the back of unexpected commentary from the Fed regarding unwinding the balance sheet.

As anticipated, there was early selling last night which dragged the Dow lower, but a mid-session kick saw the index hit a high of 20,746 points, before giving up most of those gains to finish at 20,662 points up less than 0.1% on the previous day’s close.

The NASDAQ performed a little better, gaining 0.2% to close at 5878 points.

All eyes now turn to President Trump’s meeting with Xi Jinping, and from a macro data perspective the non-farm payroll numbers which will be released on Friday.

Concerns regarding the likelihood of uncertainty rubbing off on other global markets heightened after US markets closed the previous day with the Nikkei 225 benchmark index falling 264 points or 1.4%.

Japan was the next main market to trade after US markets closed, and this negative sentiment suggested European markets may have been in for a tough night.

This looked to be very much on the cards as the FTSE 100 slumped from the previous day’s close of 7331 points to hit an early-morning low of 7258 points. However, it recovered some of that lost ground throughout the day to close at 7303 points, representing a decline of 0.4%.

Mainland European markets fared better with the DAX gaining 0.1% to close at 12,230 points and the Paris CAC 40 again putting on a strong performance, rallying 0.6% to close at 5121 points.

On the commodities front, oil rallied strongly, resulting in some energy stocks providing index support.

Gold gained a little ground to close at US$1253 per ounce.

Base metals drifted lower across the board with nickel retracing 1.7% after a strong rally in the previous session.

The other main mover was zinc as it came off 1.6% to finish at US$1.22 per pound, pushing closer to the one month low of US$1.21 per pound.

The Australian dollar is fetching US$0.754.

This article is General Information and contains only some information about some elements of one or more financial products. It may contain; (1) broker projections and price targets that are only estimates and may not be met, (2) historical data in terms of earnings performance and/or share trading patterns that should not be used as the basis for an investment as they may or may not be replicated. Those considering engaging with any financial product mentioned in this article should always seek independent financial advice from a licensed financial advisor before making any financial decisions.

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.

Publishers Notice

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.

Thanks for subscribing!