Macro Wrap
Last night was relatively quiet on risk markets, as most European bourses followed Asia and had the day off due to May Day. Only the FTSE remained open and surged, mainly due to thin volume, whilst the US got a nice surprise, with a better than expected ISM manufacturing survey (covered here by Houses and Holes) sending equities up, bonds down and the US Dollar unchanged.
Other secondary data in the US painted a mixed picture for retailers, with Redbook surprising on upside, but Goldman store sales slumping – each of these covers only 10% of sales. The UK hit off the European avalanche of PMI data coming out in the next day or so, with its manufacturing PMI – whilst still expanding at 50.5 – well below consensus and slipping near contraction territory, as the Mother Country remains in recession mode.
See charts of all major markets at bottom of post.
Bonds:
- US 10 year Treasuries were sold off yields rising 3 pips to 1.94%
- German 10 year bunds were not traded, UK 10 years bid up slightly to 2.09%
Currencies:
- The USD slipped at first before rebounding in afternoon trade, but the Dollar Index remained at 78.8 during the light trade, with the Euro unchanged at 1.32
- The Yen fell against the USD to 80.25 which should bode well for the Nikkei as I pointed out yesterday
- AUD has recovered ever so slightly from its RBA induced funk yesterday, remaining at 1.0335 against the USD at the start of Asian trading.
Equities:
- Most Euro markets were closed with the FTSE up 1.3% to 5812 points
- The US bourses were all up, but it was mainly the S&P 500 making gains, up 0.5% to 1405 – now up over 11% year to date, with the Dow Jones up 0.5% at a four year high – are we moving into “Sell in May” season again?
- The NASDAQ 100 remains flat with Apple (AAPL) still falling, albeit only $2 to $582USD
Commodities:
- The CRB Index surged again, up 2 points to 307 points, slowing coming off a bottom, which bodes well for Aussie miners:
- Oil prices were bid up, with ICE Brent up 0.25% at $119.78 per barrel and NYMEX WTI crude up over 1% to $105.97 USD per barrel, whilst natural gas continues to surge, up over 3% to $2.36 (I think this is called revert to mean?)
- Gold (USD) had another flat night during, although again sheniganas at the beginning of NYMEX trading, saw the precious metal/pseudo currency/speculative commodity/saviour against ze printers etc jumping over $15 per USD, before coming back to where it started in Asia yesterday at $1662USD an ounce
- Iron ore import prices into China were unchanged due to the May Day holiday at $US 145.40
Today in Asia
- Data today locally and regionally is sparse, with markets getting up steam again when the European session opens. German unemployment and then EMU manufacturing PMI’s will take center stage, then both EMU and US unemployment. A big day and week in data continues.
- The futures are pointing to a slightly higher open for the ASX200, probably at 4440 points.
- Click here for our economic calendar.
Market Charts
| AUD_USD | EUR_USD |
| US DOLLAR INDEX | GOLD USD |
| S&P500 | VIX VOLATILITY |
| DAX 30 | SPOT BRENT CRUDE |
| RJ/CRB COMMODITY INDEX | CHINA IMPORT IRON ORE |
Sovereign 10 year bond yields
| UK | USA | ||||||||
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JAPAN | GREECE | IRELAND | SPAIN | ITALY | FRANCE | GERMANY | PORTUGAL | AUSTRALIA |
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