Futures down 15 points as overseas markets continue to fall
The index (XJO) came off 17 points on Wednesday to close at 6179 points, a decline of 0.3%.
In line with overseas markets, it was predominantly travel and financial stocks that led the market lower.
Strong performances from some tech and healthcare stocks helped to offset this downward pressure.
However, it could be a different story today because it was consumer discretionary stocks that felt the pinch overnight in the US with prominent casualties being Walmart Inc, Nike Inc and Home Depot, while services companies such as Honeywell International and Inc and Caterpillar Inc made good gains and Boeing recovered some of the previous day’s losses.
The ASX SPI200 index is down 15 points to 6146 points, but this could be a little optimistic with real concerns surrounding an acceleration of COVID cases in Europe, combined with a lack of intent by the US government to instigate an interim stimulus package placing a significant drag on equities markets.
Similar issues will come to the fore today in Australia with monetary policy likely to be the key areas of attention when Reserve Bank of Australia governor Philip Lowe delivers his address.
With employment figures also to be released today, we could see domestic macroeconomic factors emerge as key market drivers.
Scanning overseas markets, the FTSE 100 started in the black but unravelled throughout the day setting the tone for lacklustre trading in mainland Europe and providing a backdrop of negative sentiment as US markets opened.
The FTSE 100 came off 0.6% to close at 5935 points, while the DAX edged up slightly and the CAC 40 gave up a meagre six points.
In the US, markets were up slightly in morning trading but trended down across the board during the afternoon with the NASDAQ being hardest hit.
It finished down 95 points or 0.8% to 11,768 points, while the Dow fell 166 points or 0.6% to close at 28,514 points.
Keep an eye on oil stocks
Oil was the late mover on the commodities front with the Brent Crude Oil Continuous Contract surging from about US$42.20 per barrel to US$43.32 in afternoon trading.
This was in response to comments made by Russia’s energy minister Alexander Novak that the OPEC+ alliance would still be able to gradually ease production cuts from January as previously planned.
Gold pushed back through US$1900 per ounce, and it is currently hovering just above that mark.
Iron ore came off 1% to close at US$119.50 per tonne.
Aside from nickel, there was little movement amongst base metals.
However, nickel recorded a significant milestone, regaining the US$7.00 per pound mark, a level it only touched briefly in late August/early September.
Given that US$8 per pound is a long-term high for the metal, it is in extremely strong shape with potential for more upside if manufacturing activity continues to improve.
The Australian dollar was virtually unmoved overnight at US$0.716, but this could change today in response to Reserve Bank of Australia commentary.
Where to invest $1,000 right now
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.
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.
