Morning thoughts and opening prices 28/3/12

IG Markets - Morning thoughts and opening prices

In US trade, markets retreated as the euphoria from US Fed Chairman Ben Bernanke’s comments waned. Investors also digested benign US home prices and consumer confidence data. Risk appetite fell, which saw the US dollar gain ground against most of the majors, while equities and commodities slipped.

Among the major averages, the Dow Jones Industrial Average was down 0.3% at 13198. The S&P was 0.3% lower at 1413 and the NASDAQ shed 0.1% to finish at 3120.

The Nikkei was the highlight of trade yesterday after it erased losses from last year’s earthquake. Japan’s index has been well supported by a weaker yen over the past few months and has outperformed the region. However, today we are calling the Nikkei down 1.2%, with the vast majority of that loss coming from companies going ex-dividend today. Over 200 Japanese stocks are going ex-div today.

A stronger dollar broadly weighed on commodities with gold shedding around half a percent. BHP’s ADR is pointing to a 0.7% drop at the open. We are likely to see resources come under mild selling pressure at the open. A tough night for financials in the US could also translate to falls in the local financial stocks.

Ahead of the open, we are calling the Aussie market down 0.3% at 4290. We are likely to see regional markets maintain tight ranges today, as investors digest the mixed leads from this week’s trading and wait for the next catalyst. Locally, there is nothing major on the economic front to look out for. AUD/USD slipped to 1.04526 this morning from a high of around 1.056 yesterday. This might support some of the currency sensitive stocks and help to limit downside today.

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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