Local market suspended in flat

Local market suspended in flat

By Betty Lam (Sales Trader, CMC Markets)

Mixed leads overnight set the tone for Thursday trading. Investors were still pondering inflation numbers and what it means for the timing of a future rate cut. High yielding stocks were under scrutiny and were subjected to downward pressure. The big banks and Telstra all saw a little fat trimmed off their value as traders switched to materials.

Fortescue issued official notice of the completion of their US$2.3Bn bond issue. The Iron Ore miner attempted a similar issuance just four weeks ago but was not prepared to pay the rate offered. Fortescue’s price climbed 12% across the trading day, boosted by both a surge in Iron Ore overnight and the completion of their bond through sole lead JP Morgan.

The other major miners BHP and RIO also enjoyed the fruits of Iron Ore strength. Both Iron Ore producers secured gains of over 1.5% to their share prices across the trading day. HSBC’s Flash PMI blew the wind out the sails in afternoon trade for the miners who both finished in the green.

The HSBC Flash Manufacturing PMI print returned the lowest read in the past 12 months. The Aussie dollar immediately took a tumble to the session’s low of 0.772. The local currency recovered minutes later to resume trading around US 0.773 ranges. Australian equities shrugged on the 12 month low print to continue to see saw in mild red territory. Employment claims due from the US overnight may have a bearing as to whether the Aussie dollar will hold into the 0.77 handle.

ENDS

© Scoop Media