The iron ore complex is one market that is properly rallying going into Christmas and the Chinese New Year with spot prices up nearly 5% to cross the $120 barrier again for a new three month high. Singapore futures rose nearly 7% on Monday but local Dalian futures were off 1%: It’s all about the
A red day on Asian stock markets but its not Santa coming with a rally to end the year out as fear over property debt contagion in China combined with a surprise cut in Chinese interest rates is spilling over into other risk markets. The Australia dollar and other risk currencies are retracing sharply, with
The People’s Bank of China (PBOC) announced a surprise five basis points (bps) cut to the benchmark one-year Loan Prime Rate (LPR) to 3.80% this morning, while keeping the five-year rate intact around 4.65%: This puts it into stark contrast with Western central banks with the Fed ready to unleash up to six rate
It’s been a wild ride for the Australian dollar ever since it peaked in late October at the 75 cent level against USD, falling over 500 pips to a yearly low below the 70 cent level as traders anticipated the Fed’s fight against inflation before zooming higher last week: The weekly chart above clearly shows
Risk markets were not happy following the BOE and ECB meeting’s where policy tightening against inflation is mounting, but it was a Federal Reserve member on Friday night that made markets break for the safe havens, with a “live” March meeting – and hence a quicker response – was raised. Already spooked equities fell back
Friday saw iron ore prices zoom to a new seven week high, putting in a fourth straight weekly gain, as hopes about a recovery in steel demand fostered speculation on Chinese markets. Dalian futures also rose, almost hitting $700 intrasession while rebar bounced back. However, reports that stockpiles of imported iron ore rose above 156
Asian stock markets are putting in some very poor finishes to the trading week as the post ECB/BOE policy tightening volatility shifts to equity markets following a much weaker USD that has substantially reversed overnight. The Aussie dollar is following risk markets lower while Bitcoin hovers just below the $48K level, but its all about
Western Australia continues down the path of shutting the gate before its too late with another tightening of the borders: Travel to Western Australia from every state will be restricted from midnight on Sunday, as Premier Mark McGowan again tightens the state’s border rules. Queensland will move to medium-risk status at that point, meaning only
It was a night of the hawks with the BOE and ECB signalling their intentions to tighten policies, with the former actually raising rates (alongside the Norwegians too) which saw the USD weaken immediately against the major currency pairs, but also spooked equities with Wall Street taking back all its post-FOMC gains. The bond market
Westpac sees yesterday’s Federal Reserve policy decisions, whereby the pace of tapering was doubled and indications of rate rises in 2022 was both brought forward and doubled in scope, as indicative of US economic strength and why “normalization” is being accelerated. Although where that normalization of interest rates will occur in the next cycle is
UBS contend that 2022 will not the year for mining, as the macro backdrop weakens as global demand slows down post-pandemic amid tapering of stimulus and easing of supply constraints. They reckon to avoid iron ore and coal, with their new commodity forecasts are as follows: We maintain a sector underweight but within that
The iron ore price complex had a big advance on Thursday, with coking coal up 5% at one stage, while spot prices jumped nearly 4%, all fuelled by hopes of recovering steel production after official curbs in the first 11 months of the year. Meanwhile, I thought Fortescue was going green? No sir – they
Asian stock markets are somewhat mixed today as markets absorb last nights shift by the Fed into hawk mode following the FOMC meeting with Wall Street lifting strongly but only Japanese shares following along. The late and inaccurate local jobs print pushed the Aussie dollar slightly higher but was a drag on local stocks while
After the abject failure of COP26, two startling reports have come out of the most recent earth sciences summit. First, the Arctic is actually warming FOUR times as fast, and secondly, one of the biggest glaciers in Antarctica is likely to shatter very soon. Fuzzy good feelings below from CNBC on the latter: An ice
The Australian dollar was already pumped up by the hawkish Fed meeting overnight, jumping back above the 71 handle against USD and nearly clearing the former weekly high at the 71.80 level. This mornings job numberwang print has seen it nearly clear that level, setting up for a potential breakout: Although RBA Chairman Lowe is
Well, this is what happens when you open borders and let in the great unwashed Victorians and Cockroaches who are seeking sun and surf: From the ABC: Queensland has 22 new cases of COVID-19 and 18 of those were detected outside quarantine, Health Minister Yvette D’Ath says. The local cases spent up to a week in
The hawks are circling on Wall Street with yet another selloff overnight, the fifth in a row for European equities as risk markets anticipate the forthcoming FOMC meeting. The bond market actually slipped a little although the 10 year Treasury yield only lifting slightly, up to 1.47% level while the USD continued to firm against
Spot iron ore prices lifted slightly in China yesterday, with steel futures hitting a one-week high but the continued decline in steel production saw a 2% drop in Dalian iron ore futures. Meanwhile, steel output in China continues to slip: China’s full-year crude steel output in 2021 is expected to reach 1.04 billion tonnes, falling
Just a few hours ago, the US Federal Reserve held its FOMC meeting for December and surprised with a doubling of its taper – that is, the speed at which it winds down its asset purchase program that has been holding up equity markets (and everything else) since the pandemic began, with the end date
Asian stock markets are a bit more cautious today as traders get get for tonight’s FOMC meeting with only Aussie stocks taking a diver as the Australian dollar hovers at the 71 cent level as other undollars catch their breath. Bitcoin is still struggling to keep its head above water, currently at $48K, up slightly
The latest Westpac-Melbourne Institute Index of Consumer Sentiment for Australia declined 1% for the month “amid mounting concerns around the newly emerging omicron variant and the continued circulation of COVID cases in the country.” The big concerns for consumers is now inflation and interest rates as specufestors and Bunnings Addicts Anonymous take a deep breath
The hawks are circling on Wall Street with yet another selloff overnight, the fifth in a row for European equities as risk markets anticipate the forthcoming FOMC meeting. The bond market actually slipped a little although the 10 year Treasury yield only lifting slightly, up to 1.47% level while the USD continued to firm against
Westpac is out with an updated research note on commodities, contending that 2021 was the top for commodity prices, citing production costs now far outweighed by a “fundamental correction to high(er) prices”. There’s stormclouds on the horizon as the US Federal Reserve begins to taper its bond purchases and stamp on the interest rate hikes,
The iron ore complex saw spot prices pullback while coking coal and rebar futures lifted on supply concerns yesterday. Interesting read from Stockhead regarding the push away from coking coal for the steel industry, as the decarbonising movement rolls on, lowering emissions will mean a big shift to super high grade iron ore – problem
A sea of red across Asian stock markets today in response to the poor start to the trading week on overnight markets as a run to safety including USD, Yen, Treasuries and bonds leaves equities at the kiddie table for dinner time. The USD is firming against almost everything as we head into tomorrow’s FOMC
It’s not looking good for crypto-fanatics with Bitcoin diving deeper into the red Nothing to fear about key technical levels getting assaulted, its really about the lack of transparency and regulation than the epic volatiltiy that are the big risks. Ian Verrender had a smashing article on Bitcoin et al yesterday at the ABC: For
The question on everyone’s lips is when is the US Federal Reserve going to raise rates to combat inflation? With US real average hourly earnings falling, food inflation spiking and the Great Resignation rolling ahead, it may sooner rather than later. Interest rate futures are putting it at June next year, with the tapering and
The iron ore complex saw a big move higher on Monday with spot prices up more than 6% on a recent pledge by the Chinese government to “focus on economic stability”, giving a big boost to the demand outlook. Meanwhile, Westpac are seeing their forecasts for iron ore moving down again: Our forecasts have iron
Wall Street caught its breath last night, reversing sentiment after truly absorbing the Friday night inflation prints with a slump across major equity markets in Europe as a run to safety in USD and Treasuries gathered pace. The bond market firmed sharply, with the 10 year Treasury yield pulling back from 1.5% to just above
Asian stock markets are all lifting in unison as we start a new trading week following the big inflation prints in US and Germany on Friday night. The USD is gaining a little strength against risk currencies although the Australian dollar remains well above the 71 cent level and looks quite firm. Meanwhile gold is
