IG Markets - Morning Prices Nov 1

Good morning,

Risk assets were mixed as US markets returned to trade in relatively quiet session to finish off the month. In the European session, comments around Greece dictated sentiment and resulted in some choppy trade as market participants tried to pre-empt headlines from the Eurogroup meetings. There is a lot of noise around the Greece bailout at the moment and it is unlikely we will get anything concrete until the Troika review report is released. Economic data released in European and US trade was mostly disappointing and failed to provide European equities support. EUR/USD was perhaps the most volatile asset in the risk space with an initial spike to 1.302 before retreating to trade at around 1.296. AUD/USD charged to 1.04 again but failed to maintain its run without a catalyst to propel it through that resistance zone.

Ahead of the open, we are calling the Aussie market down 0.4% at 4501. There is a lot happening on the economic front today with several data releases on the calendar. Locally we have the AIG manufacturing index, import prices and commodity prices data due out. We also have China’s manufacturing PMI and the HSBC final manufacturing PMI to look out for. Since May 2009, China has only had two months of contractions with a year average of 50.8. China’s manufacturing PMI is expected to come in at 50.3 with analysts having a range of 49.8 to 51.8. Should we see this data come in at the upper end of this range, this could trigger a rally in the risk space and finally see AUD/USD break through the 1.04 level which it has failed at several times recently. Elsewhere in the region we have PMIs for Korea and Taiwan which tend to be a forward indicator for China.

On a stock level, we expect to see a softer start for BHP Billiton with its ADR pointing to a 0.5% fall to $34.09. Gold miners might be in for a recovery this month after a poor showing in October as the precious metal struggled. Arrium (ARI) will be an interesting one to watch today. Some feel the stock might give back some of its recent gains after its bidders walked away and speculators liquidate. However, the fact that ARI rejected the improved ‘opportunistic’ bid might give some investors confidence that management is determined to create further value for shareholders and sees a bright future for the company. ARI was downgraded to sell (from hold) by Deutsche Bank this morning.

Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0375 -0.0004 -0.04%
ASX (cash) 4501 -16 -0.35%
US DOW (cash) 13051 -61 -0.46%
US S&P (cash) 1405.2 -8.4 -0.59%
UK FTSE (cash) 5782 -58 -0.98%
German DAX (cash) 7261 -24 -0.32%
Japan 225 (cash) 8906 -56 -0.63%
Rio Tinto Plc (London) 31.04 -0.39 -1.23%
BHP Billiton Plc (London) 19.86 -0.25 -1.22%
BHP Billiton Ltd. ADR (US) (AUD) 34.09 -0.16 -0.46%
US Light Crude Oil (December) 86.01 0.16 0.19%
Gold (spot) 1720.6 9.0 0.52%
Aluminium (London) 1903 -17 -0.90%
Copper (London) 7747 -36 -0.46%
Nickel (London) 16167 48 0.29%
Zinc (London) 2063 0 0.00%
Iron Ore 119.3 -0.50 -0.42%

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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