OVERNIGHT MARKET SNAPSHOT FOR THURSDAY 30/09/21 (as at 7:30am AEST)
- SPI200 (Dec) overnight futures up 23 pts to 7199
- SP500 up 6.83 pts to 4359.46
- NASDAQ Composite down 34.24 pts to 14512.44
- Dow Jones up 90.73 pts to 34390.72
- FTSE100 up 80.06 pts to 7108.16
- DAX30 up 116.71 pts to 15365.27
- GOLD futures US session (Dec) down $11.40 to $1726.10 an ounce
- COPPER futures US session (Comex Dec) down $0.0695 to $4.1770 a pound
- OIL futures US Session (Nymex Nov) down $0.46 to $74.83 a barrel
- CRB Index down 1.44 pts to 227.15
- AUDUSD trading at 0.7177
- EURUSD trading at 1.1598
- GBPUSD trading at 1.3426
- USDJPY trading at 111.9800
- USD Index US Session (ICE Dec) up 0.612 to 94.392
US indexes were well contained and range bound from the open as sellers held prices down and bulls were kept in check. Wall street is again showing some nervousness around the US Governments debt-ceiling issues and are growing concerned for a fiscal crisis which comes at a time when markets are under pressure. Even though this same scenario has played out prior and been resolved after a bit of political chess, it could easily trigger a sell off as bulls get impatient. US 10-year bond prices held the lows but may have stemmed the tide of selling for now as prices have pushed into daily support. After all the Fed Reserves speeches overnight, the one concern is inflation. They all agree that supply bottlenecks are continuing and even getting worse in some areas and this has had a flow on affect to inflation. They mentioned that their initial targets for inflation easing were wrong and high inflation will be around longer than expected which has led some Fed Reserves to lift rates already. The big boys are showing some concerns for ‘sticky inflation’ and what that may mean to tapering while they still remain adamant that it will be temporary and the anomaly will correct itself soon….just covering all bases. The DOW closed up 0.26% while the broader SP500 ended up 0.16% and the Nasdaq closed down 0.24% for the session. In Europe, major Indexes were stronger with the DAX being largely range bound like the US, while the FTSE rallied into the close finding more support from bulls. With some good news and some upbeat earnings forecasts, bargain hunters came out looking for cheap shares and looked past the recent selloff.
The USD Index largely brushed aside the debt ceiling concern ( expecting the government will just ramp up the dollar printer again ) and ramped higher on rate rise expectations. There are a few bullish factors for the dollar which is expected to lift prices longer term… Inflation and rate rise expectations, safe haven buying (with debt ceiling and economic slowdown concerns) and outperformance compared to other major currencies triggering a flow into the dollar. All in all, a dollar rally will pressure dollar denominated currencies with price set to push into 94.710. The EURUSD pressed lower into key support around 1.1600 under the weight of the USD rally. Expecting to see a continued rally into the USD pressure the Euro further as sellers target stop losses below 1.1600 support. From there, it will be about the USD and whether it takes a breather from the rally or not. The GBPUSD took another hit to extend on the previous sessions selloff. Price is extended but could easily get a head of steam on the downside as the longer term daily price action is very negative off major resistance. The AUDUSD also could not avoid the pain as price broke down below support around 0.7225. Bears are well in control and may be looking down to 0.7100 or even lower to 0.7000 to test buyers depending on what the USD does in coming sessions. The USDJPY continued to be one way action as the USD rallied and Yen buyers bailed on signs that the cost of US debt is going up. Price has cleared the 111.600 resistance level and may extend further to 112.30 if sellers remain on the sidelines and the USD continues higher. If not then there is potentially a profit taking pullback on the cards.
SPOT GOLD continued lower and pushed into 1721 support as expected before finding some buyers willing to dip their toes in the water. Price remains heavy and weighed down by the USD rally and could therefore easily extend on the losses below 1700 if buyers remain scarce. Crude Oil edged lower after seeing an unexpected lift in inventories. Expecting to see more contraction lower as recent buyers lock in some short term gains and the 75.72 lower high holds prices down. Copper came under fire as the USD rallied with price pushing down through 4.2000 minor support. With a lower high in place in the short term and the USD on the rise, price could extended on the losses below 4.1000.
Cryptocurrencies initially pushed higher through the Asian and European sessions before turning to drift lower through US trade. Prices are again hovering near previous lows and holding lower highs so watching for more short term weakness. Bitcoin is currently trading at $41269.90 down 1.39% while Ethereum is at $2824.33 down 2.04% and Ripple is at $0.91625 down 0.28%.
The ASX200 took another hit yesterday moving lower from the open to end down 78.9 points to 7196.7. Shares in IT, Energy and Resources were the biggest drag while the Gold sector was surprisingly stronger. Like the ASX, the Nikkei took a hit to end down 2.12% while the Hang Seng opened lower but spent all session rallying to end up 0.67%.
The ASX200 is expected to open up 20 points as the SPI200 managed to claw back some of the losses from the day session.
JPY Prelim Industrial Production and Retail Sales 9:50am
CNY Manufacturing PMI 11am
AUD Building Approvals 11:30am
GBP Current Account and Final GDP 4pm
EUR German Unemployment Change 5:55pm
USD Final GDP and Unemployment Claims 10:30pm
USD Chicago PMI 11:45pm
SPI200 INTRADAY LEVELS TO WATCH