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Global Market Report - April 17, 2018

Lex Hall  |  17 Apr 2018Text size  Decrease  Increase  |  
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Australia

At the open Australian stocks have gained 0.19 per cent, with the S&P/ASX 200 index 5,852, following a rally on Wall Street. The Australian dollar has edged up to US78c. Miner Whitehaven has led some of the early gains, and investors in the resources sector will get an indication of the state of the industry as Vale, Rio Tinto and BHP unveil quarterly production reports this week.

Meanwhile, the royal commission into banking and finance continues today, renewing its focus on financial planning. Insurer AMP Ltd and the big four banks have admitted to the commission they made payments that were banned five years ago as part of reforms to eliminate conflicts in financial advice. This follows yesterday's revelations that scandals in the financial advice sector were the result of deliberate commercial decisions.

Asia

Markets in the Asia-Pacific region edged higher on Tuesday as investors await US earnings results and Chinese GDP. The world’s second biggest economy is expected to continue its strong momentum from last year into the first quarter of 2018, after growing 6.8 per cent in the fourth quarter.

US President Donald Trump is welcoming Japan Prime Minister Shinzo Abe to Mar-a-Lago on Tuesday, where North Korea and trade are likely to dominate talks. Japan will also report inflation data. MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.22 per cent. Japan’s Nikkei rose 0.2 per cent. South Korea’s KOSPI gained 0.2 per cent.

Europe

Shares in global ad giant WPP have fallen 6.5 per cent as investors continue to grapple with the departure of chief executive Martin Sorrell. UK-listed Russian minter Evraz fell 7 per cent in the wake of Trump imposed sanctions. The FTSE 100 shed 0.9 per cent, while the Stoxx 600 index and the Xetra Dax in Frankfurt fell 0.4 per cent.

The UK will on Tuesday release unemployment and wage data, with inflation to follow on Wednesday. The rise in the cost of living as measure by the Consumer Price Index is expected to remain at 2.7 per cent, while the Retail Price Index is forecast to have dipped in March to 3.6 per cent.

North America

The dollar traded at the lowest in two months as real consumption growth falters. This comes despite a rebound in US retail sales last month. Streaming giant Netflix is up more than 5 per cent after its latest results showed it again added more subscribers than Wall Street expected.

Meanwhile, President Trump has accused Russia and China of devaluing their currencies at a time when the US Fed is raising the cash rate. Meanwhile, China has increased its holdings of US Treasuries, despite earlier threats to cut back at the height of last week’s trade tensions.

US shares closed higher overnight with all three benchmarks up over 0.7 per cent. The Dow advanced 0.9 per cent, the S&P 500 was up 0.8 per cent and the Nasdaq finished up 0.7 per cent.

Oil has fallen slightly as the market adjusts to the Coalition Syria strikes at the weekend. Brent crude was down 1.3 per cent and US oil fell 1.5 per cent. However, fears of retaliation over the airstrikes on Syria appear muted as investors turn their attention to the earnings season. Goldman Sachs Group and Morgan Stanley are among companies reporting results. Treasury yields were steady and West Texas Crude futures traded below $US67 a barrel.

 

 

is content editor for Morningstar Australia

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