A flat start to trading on the ASX today and don’t expect much of a lead globally until next week with the US markets closed tonight for Thanksgiving and trading on Friday night in a shortened session.
That means most US investors will be absent, any price moves will reflect the thin demand and volumes, and nothing significant should be read into what happens in the next two days.
In fact all eyes are on next week and next month – the Reserve Bank meeting on Tuesday and third quarter GDP figures on Wednesday for local investors, an expansion of its already huge easing by the European central Bank, and the two day Fed meeting mid month, and before that, Friday night week’s November jobs report for the US, the last piece in the rate rise puzzle.
The US dollar will bounce around, as will commodity prices. In fact we have seen some of that in the past couple of days.
European markets won’t provide a real lead, they are too focused on next week’s meeting of the ECB and its expected expansion of the current bout of quantitative easing – that’s driving the euro lower and the greenback higher.
That has helped the Aussie dollar maintain the 72 US cent level and a bit more ahead of next Tuesday’s Reserve Bank board meeting.
Overnight saw markets rise in Europe and edge higher in the US. Gold eased, oil fell, then rose in after hours trading after there was another small fall in US oil rig use this week.
The Dow, S&P 500 and Nasdaq hardly moved at the end – markets are convinced the US faces a rate rise next month.
Iron ore prices rose 0.4% to just above $US a tonne, but BHP Billiton shares fell 2.6% in London, while Rio Tinto was off 1% as investors there reacted to Tuesday’s sharp fall in iron ore.
The Stoxx Europe 600 rose 1.4% to close at 380.84. France’s CAC 40 jumped 1.5% to 4,892.99, Germany’s DAX 30 ended higher, pushing the index up 2.2% to 11,169.54. That’s the DAX’s highest close since Aug. 11.
In London, the UK’s FTSE 100 ended up 1% at 6,337.64, its highest close in nearly three weeks led by housing stocks which rose after the Autumn financial statement from the British government called for a rapid rise in the construction of new homes, with government support.
The local market will start trading later this morning with a small loss of 8 points this morning, which is neither here nor there.
That was after the ASX200 index lost 0.6% yesterday to end the day on 5193.7, while the All Ordinaries index was also 0.6% lower at 5245.2.
