IG Markets Morning Prices 10/3/11

In the US overnight, the major indices oscillated between modest gains and losses as the situation in Libya continued to keep traders searching for direction on the second anniversary of the beginning of the bull market.

The Dow Jones Industrial Average was the best relative performer, finishing flat on the day. Elsewhere, the broad based S&P 500 index finished 0.1% lower while the NASDAQ was down 0.5%.

Locally, the ASX 200 is called to open the session 0.1% higher at 4774 following the flat to modest declines on Wall Street.

The materials sector was by far the worst performer in US trade, down 1.5% and will likely weigh heavily on the local stocks. Base metals on the London Metals Exchange were sold heavily, all closing down between 1% and 4.7% while in normal London trade, Rio Tinto and BHP Billiton declined 1.4% and 2.5% respectively. Unsurprisingly, BHP Billiton’s ADR is calling the locally listed name to open 0.8% softer at $45.64.

Gold stocks should be supported after the precious metal continued to remain well bid, finishing the overnight session 0.3% higher at US$1429.30/oz.

The energy sector also saw losses, finishing down 0.8% after a retreat in Crude Oil prices overnight. The black gold slipped 0.4% and is currently trading around the US$103.95/barrel level. The situation in Libya hasn’t changed too much; it was the Crude Oil inventory reports in the US that provided the impetus for oil to move lower. The government report showed Crude Oil inventory levels rose more than expected, up by 2.5 million barrels.

Elsewhere, financials were flat in US trade while consumer staples names saw some buying, rising 0.6%.

In summary, the leads are pointing towards a flat open to the local session. However, the ASX 200 has basically ignored most leads over the last few days so where we open is almost anyone’s guess. We underperformed significantly yesterday so maybe there’ll be some support today.

In economic news, inflation expectations are due at 11am while the latest reading on the all important employment numbers are due at 11.30am. The market is expecting the Australian economy to have added 20,800 new jobs and for the unemployment rate to have remained at 5%. The release will be closely watched as it’s important in helping the RBA determine its next move on fiscal policy.

The big news this morning in currency markets was the RBNZ cutting the official cash rate by 50 basis points to help the country cope with the devastating financial impact of the recent earthquakes. The RBNZ said it is likely to be a temporary measure as there will be inflationary pressures in the not too distant future The NZDUSD fell away sharply, hitting a low of 0.7332 before recovering significantly; its currently trading around 0.7365.

Market / Price at 8:00am AEST / Change Since Australian Market Close / Percentage Change
AUD/USD / 1.0102 / 0.0034 / 0.34%
ASX (cash) / 4774 / 6 / 0.13%
US DOW (cash) / 12212 / 21 / 0.17%
US S&P (cash) / 1319.7 / 1 / 0.08%
UK FTSE (cash) / 5940 / -15 / -0.25%
German DAX (cash) / 7134 / -21 / -0.29%
Japan 225 (cash) / 10593 / 10 / 0.09%
Rio Tinto Plc (London) / 40.88 / -0.58 / -1.40%
BHP Billiton Plc (London) / 23.83 / -0.60 / -2.46%
BHP Billiton Ltd. ADR (US) (AUD) / 45.64 / -0.36 / -0.77%
US Light Crude Oil (Apr) / 103.95 / -0.44 / -0.43%
Gold (spot) / 1429.3 / 4.20 / 0.29%
Aluminium (London) / 2577.00 / -27 / -1.04%
Copper (London) / 9280.00 / -250 / -2.62%
Nickel (London) / 26176.00 / -852 / -3.15%
Zinc (London) / 2280.00 / -113 / -4.72%
RBA Cash Rate to be raised by 25bp (Apr) (%) / 8.00 / 0 / 0.00%

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.

Please contact IG Markets if you require market commentary or the latest dealing price.

ENDS

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