The local market will be heading for a small fall today after mixed trading Friday around the world for shares and commodities, and some nerves ahead of an important GDP report here on Wednesday and President Trump’s first State of the union speech Wednesday morning, Australian time.
As well an important start of the month economic data here, and in other major economies will also play a big part in either keeping the market buoyant, or seeing it edge sideways and perhaps slide.
A speech on Friday by Fed chair, Janet Yellen will also be watched closely after the US central bank’s most recent minutes seemed to signal the Fed was looking to tighten rates a bit earlier than expected – with the March meeting a real possibility.
While Eurozone shares fell 0.9% on Friday, the US S&P 500 saw a late rally that pushed it up 0.1% perhaps in anticipation of President Trump’s address to Congress and more details on his tax and economics policies.
The MSCI world equity index, which tracks shares in 46 nations, fell 0.3%, to 445.32. It reached an all-time peak at 447.67 on Thursday.
Despite the flat US lead, ASX 200 futures fell 0.3%, pointing to a 16 point fall at the open for Australian shares later today.
On Friday the ASX200 finished down 0.8%, and 1.2% for the week to 5739.0, while the All Ordinaries index dropped 1.1% to 5786.9.
Friday’s close continues a seesaw week which saw US shares up 0.9%, 1.5% in China and 0.3% in Japan (helped by more good economic data, with more expected today and tomorrow from Tokyo).
But Eurozone shares fell 0.3% and Australian shares lost 1.2% as profit results became more mixed towards the end of the profit reporting season. They will face more pressure today and tomorrow as a flood of weak to problematic figures are release.
The results will be dominated by QBE which issues its full year figures today and Lend Lease, which is also down to report today. Harvey Norman reports either today or tomorrow in its usual spot as bringing up the rear,
Bond yields generally fell (raising questions about why the fall is underway, especially in the US and Germany) when markets are generally buoyant and commodity prices were mostly up. The $A was little changed.
On Wall Street, however, the Dow Jones Industrial Average extended its winning streak to 11 sessions, the longest since 1987, and the S&P 500 rebounded from earlier losses. The Nasdaq Composite erased an earlier drop, paring its weekly loss.
The Dow ended up 11.44 points, or 0.05%, at 20,821.76; the S&P 500 closed 3.53 points, or 0.15%, higher at 2,367.34 and the Nasdaq finished up 9.80 points, or 0.17%, to 5,845.31.
The three indexes posted record highs this week, buoyed by confidence about company results in the coming quarters even without fiscal stimulus.
For the holiday-shortened week, major indexes posted gains with the Dow up 1%, the S&P adding 0.7% and the Nasdaq a mere 0.1%. That marked the fifth straight weekly advance for the S&P and the Nasdaq, and the third straight for the Dow.
And Stocks in Europe dropped by the most in three weeks, finishing Friday’s session down from 14-month highs as investors questioned the prospects for US tax policy changes under President Donald Trump.
The Stoxx Europe 600 closed dropped 0.8% at 370.01, the biggest decline since in almost a month.
Among major national indexes, Germany’s DAX 30 slid 1.2% to end at 11,804.03.
The moves pushed the Stoxx 600 into the red for the week. It notched a decline of 0.1% after earlier this week hitting its strongest levels since December 2015.
France’s CAC 40 lost 0.9% on Friday. London’s FTSE 100 fell 04%, and Italy’s FTSE MIB fell 1.2%. In fact a sell off in UK banks saw the Footsie lose 0.8% over the week ending three consecutive weeks of gains.
