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As the clouds of the Italian Referendum cleared, the S&P 500 index returned to bask in the glow of the Trump-inspired optimism. The index continued on its upward trajectory, sweeping up another 0.34% gains.
The telecommunication and financial sectors clocked strong gains to bring the index up to a high of 2212.78 ahead of the close, eyeing 30 November’s all-time high of 2214.10. A break above last Monday’s high could once again fuel further upward momentum.
Notably the energy sector was down 0.10% on Tuesday after four consecutive session of gains. The DJIA meanwhile remained supported above 19,200 at the close but could not outdo Monday’s 19,274.85 all-time high.
Crude oil prices saw a slight correction down on Tuesday. WTI futures slipped to trade the overnight session mostly below the $51.00 per barrel level. Some support came from the API report, which saw US crude supplies declining 2.21 million barrels in the previous week, lifting the WTI future prices up to $51.00 per barrel.
The boost had nevertheless been marginal with more data due to be fed in from the EIA report tonight. The market’s attention has been focused ahead on the meeting between OPEC and non-OPEC producers on Saturday, December 10, though the meeting is unlikely to serve as the next inflection point for prices. The slashing of production by 600,000 barrels per day by non-OPEC producers has been expected to be the conclusion of the meeting.
The theme for Asia midweek will largely be consistent with Tuesday. Asian indices look set to see moderate gains on the back of the euphoria that stems from US and European markets. This is despite the absence of the boost for oil-related equities we had experienced in the past few sessions.
Meanwhile Australia’s Q3 GDP surprised on the downside at -0.5% quarter on quarter seasonally adjusted (QoQ SA) from a revised 0.6% QoQ SA in the previous quarter. This is the lowest QoQ figure printed since the 2008 financial crisis and a significant dip from the market consensus of -0.1% QoQ that was already sitting in negative territory. In year on year (YoY) terms, growth slowed to 1.8% YoY from 3.1% YoY previously. AUD/USD took a dip upon the release, plummeting from $0.7465 to a low of $0.7420 with the market evidently taken by surprise.
The day ahead will see the market watching the Reserve Bank of India’s interest rate decision where a cut by 25 basis points has been expected. Malaysia and Taiwan will also shed more light on the October trade conditions in Asia. Notably, a slew of foreign reserves will also be seen in Asia with the focus on China’s November update.
Yesterday: S&P 500 +0.34%; DJIA +0.18%; DAX +0.85%; FTSE +0.49%