daytrading nov 13 pre-market

Morning traders.

Market wrap:

Shares are pointing lower after the threat of a possible reduction in stimulus spending next month dragged US stocks from record heights.

The December SPI 200 futures contract eased 17 points or 0.3% to 5394 as BHP and Rio Tinto lost ground during a weak session for oil and metals.

The S&P 500 fell four points or 0.22% as Federal Reserve officials warned that the central bank could taper its bond-buying program as soon as next month's meeting. The Dow dropped 32 points or 0.2% from Monday's record close, while the Nasdaq reversed early losses to close 0.01% ahead.

The taper "could very well take place in December", Atlanta Fed President Dennis Lockhart said overnight. His warning followed comments from Richard Fisher, Dallas Fed President, who told an Australian audience yesterday that markets should position themselves for the taper. Fed Chairman-elect Janet Yellen is due to testify before the Senate Banking Committee tomorrow night.

"The [US] jobs report [last] Friday, that's really what changed the idea that we could have a December taper, and ever since then you've had more and more comments coming out of the Fed that perhaps it is on the table," James Paulsen, chief investment strategist at Wells Capital Management in the US, told Bloomberg. "Last night it was Fisher and now Lockhart. What he came out and said today isn't earth-shattering but it does add to the momentum of the idea."

Optimism among small businessmen in the US last month declined to its lowest level since April. The National Federation of Independent Business's small-business optimism index dropped to 91.6 from 93.9 in September.

Financial stocks and utilities were the biggest losers as eight out of ten S&P industry groups fell. The Dow Jones Transportation Average was a notable exception to the general weakness, rising 0.69%.

Australia's biggest miners declined for a second night in US trade as strength in the US dollar kept the pressure on commodities. BHP lost 1.04%, Rio Tinto 1.0.3%. Spot iron ore for import to China was yesterday steady at US$135.90 a dry tonne.

Oil slumped to its weakest price since May amid bearish production outlooks from OPEC and the International Energy Agency as North American production ramps up next year. West Texas Intermediate crude for December delivery dived $2.01 or 2.1% to US$93.13 a barrel. Read more here.

All the taper talk weighed on gold, traditionally used as a haven against inflation. Gold for December delivery was lately down $12.80 or 1% at US$1,268.50 an ounce.

The rising dollar also sapped demand for base metals. US copper for December delivery was recently down nearly four cents or 1.2% at US$3.22 a pound. In London, copper dropped 0.7%, aluminium 0.5%, lead 0.9%, nickel 0.9%, tin 1.1% and zinc 0.5%.

The major European markets fell back with resource stocks and financials the biggest drags. Germany's DAX lost 0.35%, France's CAC 0.61% and Britain's FTSE 0.02%.

TRADING THEMES TODAY

COMING OFF: The levee hasn't burst but the gentle short-term downward trend on the ASX looks likely to continue today. Last night's pro-market post-plenum Chinese policy statement seemed to have little impact. Read more here. The rising greenback was more of a concern as oil and metals took a hit. The Gold Bugs index dropped 2.32% and oil services index 1.55%. Fortunately, the Australian speccy sector continues to run hot, with no shortage of opportunities for momentum and breakout traders.

ECONOMIC NEWS: Consumer sentiment figures are due at 10.30am EST, followed by the wage price index at 11.30am. Europe releases industrial production data tonight. The light start to the week in the US continues with the Federal Budget Balance and a bond auction.

Good luck to all.