IG Markets - Morning Prices October 29

It was a mixed session for risk assets on Friday as a growing number of factors kept market participants at bay. With US elections fast approaching and Hurricane Sandy headed for the US east coast, it’s not too surprising to see US equities trading relatively flat. Disappointing US earnings also continued to affect sentiment and overshadowed some of the positive economic releases. US GDP data topped estimates, while doubts over Greece’s ability to meet its bailout requirements weighed. In the risk currencies space, EUR/USD managed to find some support at around 1.29 while AUD/USD held up quite well, bouncing from around 1.03 to a high of 1.0386. The AFR is reporting that the RBA has resorted to allowing offshore purchases of the AUD to be absorbed on its own balance sheet in a bid to cap gains in the local currency. This is a more subtle way of intervening in the fx market.

Ahead of the open, we are calling the Aussie market up 0.4% at 4491. We saw a pretty sharp sell-off into the close on Friday and the early gains would see the local market recuperate some of those losses. The sell-off was likely a result of investors exercising some caution ahead of the weekend. There is nothing major on the economic front today and it is likely to be a quiet session for the ASX 200. We haven’t seen any big moves in the risk currencies this morning suggesting sentiment remains relatively subdued. Elsewhere in the region, we have Japan retail sales data due out and this will be closely watched ahead of the BoJ meeting. We have seen traders fading USD/JPY’s recent strength before this week’s BoJ meeting. USD/JPY was sold off from a high of 80.39 all the way down to around 79.50.

On a stock level, we expect a firmer start for BHP Billiton with its ADR suggesting the stock will fall 0.5% to $34.01. Iron ore prices remain relatively steady at around US$120 per tonne. Oil will be an interesting one to watch with ‘superstorm’ Sandy due to hit the east coast. Depending on the intensity of the storm, oil prices will likely get the biggest reaction. As a result, energy stocks will be firmly in focus today. Macquarie shares will remain under watch today after Friday’s results. Of course the stock had a big run on Friday but it remains unclear just how bullish investors are on the company, given analysts’ conservative ratings calls on the stock.

Market Price at 9:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0366 0.0058 0.56%
ASX (cash) 4491 19 0.42%
US DOW (cash) 13107 102 0.78%
US S&P (cash) 1410.3 10.8 0.77%
UK FTSE (cash) 5809 62 1.08%
German DAX (cash) 7238 94 1.31%
Japan 225 (cash) 8959 16 0.18%
Rio Tinto Plc (London) 31.11 0.11 0.34%
BHP Billiton Plc (London) 19.82 -0.13 -0.64%
BHP Billiton Ltd. ADR (US) (AUD) 34.01 0.15 0.45%
US Light Crude Oil (December) 86.08 0.96 1.13%
Gold (spot) 1712.3 8.7 0.51%
Aluminium (London) 1922 -13 -0.69%
Copper (London) 7820 21 0.27%
Nickel (London) 16005 -135 -0.83%
Zinc (London) 1834 -170 -8.46%
Iron Ore 119.6 -0.40 -0.33%

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.

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