The Overnight Report: Trump Warns Europe

Daily Market Reports | Jan 23 2020

US markets paused as the death toll from the coronavirus in China rises and with president Trump targeting Europe in Davos?

World Overnight
SPI Overnight (Mar) 7116.00 – 7.00 – 0.10%
S&P ASX 200 7132.70 + 66.40 0.94%
S&P500 3321.75 + 0.96 0.03%
Nasdaq Comp 9383.77 + 12.96 0.14%
DJIA 29186.27 – 9.77 – 0.03%
S&P500 VIX 12.91 + 0.06 0.47%
US 10-year yield 1.77 0.00 0.00%
USD Index 97.53 – 0.03 – 0.03%
FTSE100 7571.92 – 38.78 – 0.51%
DAX30 13515.75 – 40.12 – 0.30%

Greg Peel will resume writing the Overnight Report after Australia Day (next week). In the meantime, Jessica Amir from Bell Direct is providing a snapshot of insights and developments from overseas markets overnight.

By Jessica Amir, Bell Direct

The Australian share market looks set to see a negative day of trade (that’s if you go by the futures), as the death toll in China from Coronavirus has risen to 17. Now 547 people are confirmed infected in China alone, not including the other regions of the world it's spread to.

Air, train, subway and ferry transport in and out of the Chinese city of Wuhan, has now been shut down. The City has almost the population of Sydney and Melbourne, with stocks linked to Chinese travellers likely to see selling on fears that less revenue will hurt corporate bottom lines. Meantime, authorities are saying simply good hygiene can stop the virus from spreading, like covering your mouth when you cough or sneeze.

Overnight in the US, stocks had a bit of a volatile session before closing mostly flat, with the most gains in tech stocks, while the virus outbreak kept gains under wraps. IBM shares rose 3% after reporting quarterly results and its 2020 earnings guidance beating expectations. We also saw Apple shares hit an all-time high, and Tesla shares continued to gain momentum, up 4%, with its market cap hitting $100bn for the first time. Semiconductor stocks also hit an all time high, with Intel rising almost 3%.

In other news, equity markets in Europe fell from record highs as investors focused on the World Economic Forum in Davos, with Trump again threatening tariffs on European car imports in the absence of a trade commitment from the EU.

Markets

The Aussie share market futures suggestion a -0.32%/23 point fall. Yesterday, the ASX200 gained 0.94% or 66 points.

On Wall Street, the Dow Jones closed flat (-0.03%/10 points lower), rising as much as 120 points earlier lost, the S&P500 rose 0.03% and Nasdaq added 0.13%.

European markets closed in the red. The Stoxx 600 slipped -0.08%, UK’s FTSE fell -0.51%, the French CAC fell -0.6%, while the German DAX fell from its record high, losing -0.3% with traders locking in profits.

In Asia stocks attempted to rebound from heavy falls the day prior: Japan’s Nikkei rose 0.7%, China’s Shanghai Comp added 0.3%, while Hong Kong’s Heng Seng rose 1.3%.

Gold rose slightly compared to yesterday and is at US$1,558 an ounce.

Oil fell -2.95% to US$58.25 a barrel, on supply risks lingering.

Iron ore is -0.01% lower at US$94.88 a tonne.

Australian dollar trades at a 2019, 68.43 US cents in the wake of the disease outbreak.

Spot Metals,Minerals & Energy Futures
Gold (oz) 1557.90 + 0.40 0.03%
Silver (oz) 17.80 + 0.03 0.17%
Copper (lb) 2.77 – 0.02 – 0.60%
Aluminium (lb) 0.82 – 0.00 – 0.20%
Lead (lb) 0.90 + 0.01 1.18%
Nickel (lb) 6.13 – 0.03 – 0.55%
Zinc (lb) 1.10 – 0.02 – 1.59%
West Texas Crude 56.70 – 1.64 – 2.81%
Brent Crude 63.16 – 1.31 – 2.03%
Iron Ore (t) futures 95.40 – 0.20 – 0.21%

The Australian share market over the past thirty days…

BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS
AGL AGL ENERGY Downgrade to Sell from Neutral UBS
APE AP EAGERS Downgrade to Hold from Add Morgans
CLW CHARTER HALL LONG WALE REIT Upgrade to Neutral from Underperform Macquarie
CQE CHARTER HALL SOC INFRA REIT Upgrade to Accumulate from Hold Ord Minnett
CQR CHARTER HALL RETAIL Upgrade to Outperform from Underperform Macquarie
DMP DOMINO'S PIZZA Downgrade to Sell from Neutral Citi
DXS DEXUS PROPERTY Upgrade to Outperform from Underperform Macquarie
Upgrade to Accumulate from Hold Ord Minnett
Upgrade to Buy from Neutral UBS
FLT FLIGHT CENTRE Downgrade to Neutral from Outperform Credit Suisse
FMG FORTESCUE Upgrade to Neutral from Underperform Credit Suisse
HUB HUB24 Upgrade to Add from Hold Morgans
IFN INFIGEN ENERGY Upgrade to Add from Hold Morgans
MGR MIRVAC Upgrade to Hold from Lighten Ord Minnett
Upgrade to Neutral from Sell UBS
MTS METCASH Upgrade to Neutral from Underperform Macquarie
NHF NIB HOLDINGS Upgrade to Neutral from Sell Citi
Upgrade to Neutral from Sell UBS
NUF NUFARM Downgrade to Neutral from Outperform Macquarie
ORG ORIGIN ENERGY Downgrade to Hold from Add Morgans
PPC PEET & COMPANY Downgrade to Neutral from Outperform Macquarie
QAN QANTAS AIRWAYS Downgrade to Neutral from Buy Citi
QBE QBE INSURANCE Upgrade to Buy from Neutral Citi
REH REECE AUSTRALIA Downgrade to Hold from Add Morgans
RIO RIO TINTO Downgrade to Accumulate from Buy Ord Minnett
SCG SCENTRE GROUP Downgrade to Sell from Neutral UBS
SCP SHOPPING CENTRES AUS Upgrade to Neutral from Underperform Macquarie
SGP STOCKLAND Downgrade to Lighten from Hold Ord Minnett
SUN SUNCORP Downgrade to Neutral from Buy Citi
SYD SYDNEY AIRPORT Downgrade to Neutral from Outperform Macquarie
TCL TRANSURBAN GROUP Downgrade to Accumulate from Buy Ord Minnett
WOW WOOLWORTHS Upgrade to Outperform from Neutral Macquarie

For more detail go to FNArena's Australian Broker Call Report, which is updated each morning, Mon-Fri.

All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website.  Click here. (Subscribers can access prices on the website.)

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