IG Markets – Morning Prices 22 October 2010

IG Markets – Morning Prices 22 October 2010

IG Markets – Morning Prices

22 October 2010

On Wall Street overnight, US stocks finished the session modestly higher as investors digested a large batch of earnings reports and economic news. A drop in unemployment claims and a Federal Reserve report that showed a “modest pace” of growth between September and early October maybe hindering further gains as stronger data points toward a reduced QE program.

The Dow Jones Industrial Average was the best performer, up 0.4% while the S&P 500 added 0.2% and the NASDAQ 0.1%.

Locally, the ASX 200 is called to open the session largely unchanged at 4625 following volatile overnight trade.

The heavily weighted materials sector is likely to post modest gains at the open following a relatively flat overnight session. Base metals on the London Metals Exchange were mixed while in normal London trade, Rio Tinto and BHP Billiton managed gains of 1.3% and 0.9%. BHP Billiton’s ADR is calling the locally listed stock 0.3% firmer on the open. Gold players could see some pressure after gold futures declined 1.2% to US$1325.8 per ounce.

Financials are likely to be relatively flat to slightly weaker after the US sector could only manage an unchanged close. Concerns over US banks exposure to mortgages continued to rattle confidence in the sector. Australian banks have no exposure to these issues but could see some “guilt by association” selling pressure.

Elsewhere, the biggest gains may come from the industrial and consumer discretionary names after they were the best performing sectors in US trade. Amazon, Ebay and Home Depot were all up between 3.5% and 6%, boosting discretionary names.

In summary, it looks like a flat to slightly positive open for the local market. The fact the ASX 200 underperformed so much yesterday could give it reason to outperform today, although it’s typically quite hard to do on a Friday.

In terms of the AUDUSD, it saw some selling pressure overnight as the US dollar rebounded from yesterday’s falls. It’s currently trading around the 0.9780 level ahead of the key G20 meetings over the weekend. The AUDUSD continues to be at the mercy of the USD, and will likely remain this way until the next Federal Reserve meeting in early November.

Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 0.9774 -0.0045 -0.45%
ASX (cash) 4625 2 0.04%
US DOW (cash) 11128 22 0.20%
US S&P (cash) 1178.5 1 0.09%
UK FTSE (cash) 5735 17 0.29%
German DAX (cash) 6588 65 0.99%
Japan 225 (cash) 9377 14 0.15%
Rio Tinto Plc (London) 41.08 0.52 1.28%
BHP Billiton Plc (London) 22.12 0.20 0.89%
BHP Billiton Ltd. ADR (US) (AUD) 41.34 0.12 0.29%
US Light Crude Oil (Dec) 80.71 -1.22 -1.48%
Gold (spot) 1325.8 -16.2 -1.20%
Aluminium (London) 2342 -10 -0.43%
Copper (London) 8294 13 0.16%
Nickel (London) 23400 -450 -1.89%
Zinc (London) 2451 14 0.57%
RBA Cash Rate to be raised by 25bp (Nov) (%) 34.00 -2 -2.00%

IG Markets provides round-the-clock CFD trading on currencies, indices and commodities. The levels quoted in this email are the latest tradeable price for each market. The net change for each market is referenced from the corresponding tradeable level at yesterday’s close of the ASX. These levels are specifically tailored for the Australian trader and take into account the 24hr nature of global markets.

ENDS

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