In the short term, markets are still undecided again, the SP500 is back to the all-time high resistance level. With the next round of US fiscal stimulus stuck in limbo Us markets are struggling to maintain the buying.
News of a potential Coronavirus vaccine continue to keep the sellers on the sidelines. Some are optimistic for a vaccine this year, but locally most professionals are saying it is still at least a year off. Locally though it is all about reporting.
The strength in the commodities markets continue, and with weakness in the USD, we see the AUD continue to hold around 71.50. Iron Ore at the port remains very high and with Copper and other metals still holding near highs we expect miners to continue to hold current trends.
Banks locally also seem to be in a good position considering the current environment, loan holidays have stopped what could have been a disastrous year for them. But in saying that with Vic in stage 4 lockdowns with no certain end in sight any move up will likely remain limited.
The XJO is set to have a flat to weak open this morning as we continue to hold the key resistance and post-fall highs at roughly 6175. Our market is reluctant to break this level as the U.S travels along their all-time high. Overall though we have fallen behind the U.S, likely looking to local reporting as an indication as to whether we deserve to play catch up.
We maintain the broad ascending triangle, so we continue to assume that we will eventually break the post fall high in the medium term, and with a big week of reporting, hopefully it is soon. We have keen support at 6000 and beyond that the uptrend line to help buoy our market against falls.
Media focus in the short term is on local reporting and the virus. The U.S election has serious potential to affect the market, and we saw a wake up last week with Biden announcing his running mate that brought it back into media focus. This area will continue to develop and gain larger media share as we approach the election.
Check the website for company reporting dates as this is a huge week. Notable blue chips this week are: SYD, LLC, BSL, JBH, BEN, today; WBC (trade update), BHP, AMC, COH, SGM, tomorrow; ANZ (update), CSL, BXB, A2M, CWN, OZL, CAR, Wednesday; WES, SHL, S32, ORG, MPL, QAN, CCL, Thursday; SUN, FLT Friday.
US shares fell on Friday, the second day of selling for the major S&P 500 index. The index continues to trade just below it’s all-time high resistance at approximately 3,400 points, but with lawmakers dragging their heels on the next round of fiscal stimulus, investors seem to be unwilling to push prices any higher in the short-term. The renegotiation of parts of the US-China trade deal has also been delayed, with US-China tensions continuing to worry markets. Technology stocks, Telecoms, and Utilities were the weakest sectors on Friday, while every other major sector closed slightly higher.