Morning traders.
Market wrap: Stocks look set to open under mild downward pressure today after another soft night on overseas markets.
Europe and most American markets took their lead from the negative start to the week in Asia yesterday. The FTSE lost 0.75%, the CAC 0.41% and Germany 0.62%. In the US, the Nasdaq closed 0.24% higher on takeover news but the Dow lost 0.42% and the S&P 500 dropped 0.34% as the rallying US dollar crunched commodity prices and resources stocks.
Oilers and precious metals miners continued to slide in the US. Also under pressure: banks, off 0.68%, and REITs, down 1.83%. Airlines were the standout as the price of oil tumbled - the sector rallied 4.38%.
In economic news, the index of US leading economic indicators rose for the fifth straight month, the best run since 2004, confirming that a recovery is underway. The gauge of the economic outlook for the next three to six months rose 0.6% last month, in line with forecasts, after a 0.9% increase in July.
Crude oil fell for the third straight session, down 3.24% to $69.48 a barrel. Gold futures also retreated for a third session, dipping below $1,000 an ounce before recovering. The spot price was recently down $3 at $1,003.10.
Base metals were mixed in choppy trade as investors weighed healthy economic signs from the leading indicators against the rising US dollar. In London, copper climbed 0.2%. Aluminum and tin fell but nickel, lead and zinc advanced.
Futures traders expect our market to open in the red. With 20 minutes left to trade, the SPI futures index was down 10 points at 4684, following yesterday's 15-point decline on the ASX 200.
TRADING THEMES TODAY
UNCERTAINTY: Global markets are taking a breather just now and the short-term direction for markets is uncertain. The mild downturn over the last few sessions is likely nothing more than a pause before the next leg up but it could turn into a genuine pullback. The jury is still out. It's not a time to place large bets IMO.
AIRLINES: There's not much in that overnight lead to help local stock-pickers this morning, but the strength in US airlines may help our fleet take wing. The Amex Airline Index (XAL) has rallied 100% since June as American investors bet that the economic recovery will translate into better times for airlines. May be worth checking out QAN, VBA and REX this morning.
ECONOMIC NEWS: There's nothing significant locally today but tonight's US news includes housing figures for July and manufacturing data.
Good luck to all.
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