IG Markets: Morning Prices

In the US on Friday, markets sold off on continuing concerns over PIIGS nations and their debt problems as well as concerns of potential rate hikes in China to stem hotter-than-expected inflation.

The technology heavy NASDAQ was the worst performer, down 1.5% while the S&P 500 and Dow Jones Industrial Average lost 1.2% and 0.8% respectively.

Locally, the ASX 200 is called to open 0.6% lower at 4665 following Friday’s bearish session on Wall Street. It looks like we’ll see broad-based weakness today, with the commodity focused sectors likely to be the worst performers.

The materials sector is likely to be hit the hardest following a big pullback in commodities and a 2.2% fall in the US session. On the London Metals Exchange, base metals were all lower, down between 0.8% and 4.6%. In normal London trade, Rio Tinto and BHP Billiton fell 2% and 2.1% respectively, with BHP Billiton’s ADR pointing towards a fall of 0.3% on the open. Gold miners are likely to be sold heavily after the precious metal fell 1.5% or $20.00 to US$1368.5 per ounce on Friday.

Financials and energy sectors are likely to be the other major detractors after losses of 1.7% and 1.5% in the US session. Crude Oil futures slumped 2.1% to be trading around the US$84.73 level. The financials are going to be in focus as the Green’s call for a two-year ban on banks being able to lift interest rates more than the RBA does, which could lead to increased selling on the back of fears of increased regulation.

Elsewhere, consumer discretionary, industrial and consumer staples all look like opening weaker too. In summary, everything is pointing towards a pretty bleak start to the new week as the market continues to pullback from its recent high.

Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 0.9881 -0.0054 -0.54%
ASX (cash) 4665 -28 -0.60%
US DOW (cash) 11180 -38 -0.34%
US S&P (cash) 1197.1 -8 -0.70%
UK FTSE (cash) 5781 -20 -0.35%
German DAX (cash) 6711 4 0.06%
Japan 225 (cash) 9720 -47 -0.48%
Rio Tinto Plc (London) 43.14 -0.88 -2.00%
BHP Billiton Plc (London) 23.63 -0.50 -2.09%
BHP Billiton Ltd. ADR (US) (AUD) 44.15 -0.15 -0.34%
US Light Crude Oil (Dec) 84.73 -1.79 -2.07%
Gold (spot) 1368.5 -20.8 -1.50%
Aluminium (London) 2380 -40 -1.65%
Copper (London) 8571 -68 -0.79%
Nickel (London) 22450 -1090 -4.63%
Zinc (London) 2374 -76 -3.10%
RBA Cash Rate to be raised by 25bp (Dec) (%) 6.00 -2 -2.00%

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