Market Comment |
Australia |
| The S&P/ASX 200 index dropped 2.12% or 110.566pts to 5096.41 (day range: 5214 – 5091) on Tuesday. The index is below its 20d MA (@ 5327) and below its 50d MA (@ 5483). 23% of the index constituents are above their 20D MA (vs 40% the previous session) and 19% of the shares are above their 50D MA (vs 29%). Trading volume on the index was high, 42.1% above the 3 months average.
Australia’s central bank kept the official cash rate target unchanged at 2.00% (as expected). The Australian Industry Group Australian Performance of Manufacturing Index (Australian PMI) gained 1.3 points MoM to 51.7 in August. Key findings included: “Three of the eight manufacturing sub-sectors expanded: food, beverages & tobacco (down 4.7 points to 54.2); wood & paper products (up 1.8 points to 70.0); and textiles, clothing, footwear, furniture & other manufacturing (up 6.0 points to 55.2). (…) Petroleum, coal, chemical & rubber products (down 2.4 points to 48.3) returned to contraction after a brief expansion in July. The machinery and equipment (up 0.8 points to 41.3), metal products (unchanged at 43.3), and non-metallic mineral products (down 2.1 points to 42.0) sub-sectors continued to contract.” Australia’s building approvals rose 4.2% MoM in July (vs +3% expected, -5.2% in June) according to the Australian Bureau of Statistics. On a YoY basis, it rose 13.4% in July (vs +10.1% expected, +13.5% in June). Australia’s commodity index declined 20.9% YoY in August vs -19.1% in July, according to the Reserve Bank of Australia. New Zealand house prices rose 11.3% YoY in August (vs +10.1% in July), the fastest growth since November 2007, according to property research firm Quotable Value. |
Foreign Exchange |
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| The US dollar was mixed against its major counterparts on Tuesday, falling against the CHF, JPY and EUR while rising against the GBP, CAD and AUD. On the US economic data front, Markit US Manufacturing PMI fell to 53 in August from 53.8 in July and vs flash reading of 52.90. Construction spending rose 0.7% MoM in July at same pace than in June while ISM Manufacturing fell to 51.1 in August vs 52.7 in July.
The Euro was up against all its major counterparts with the exception of the JPY. Euro zone PMI manufacturing index was 52.3 in August in final estimation from 52.4 in prior one. It was 52.4 in July. Separately, euro zone unemployment rate was down to 10.9% in July from 11.1% in June. It was expected to be flat. German unemployment rate was flat at 6.4% in August, as anticipated. UK mortgage approvals increased to 68.8K in July from 67.1K a month earlier. It was expected to be 68.1K. UK PMI manufacturing index slid to 51.5 in August from 51.9 the month before. Economists anticipated 52. The Australian dollar fell against its major pairs. |
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