Market Update & Important Indicators:
Tech stocks rebounded from a three-day rout but failed to lead the broader market higher, while yields on Treasuries retreated from a seven-year peak amid rising trade tensions and a sketchy outlook for global growth; US materials stocks performed their worst since February this year as PPG Industries raised flags for the auto sector; Nickel was the big winner on the LME rallying 3% as inventories declined, while Aluminium fell a further 1% as supply concerns eroded – Norsk Hydro ASA agreed on Monday to resume aluminium production at 50% capacity; Chinese copper demand has been so strong over the past few months that top producer Codelco has almost sold out of supplies for next year, well ahead of schedule, according to the Chairman of the Chilean state-owned company; Oil prices rose on concerns over declining supply from Iran, as well as worries about Hurricane Michael in the Gulf of Mexico; China is on track to surpass Japan as the world’s largest natural gas importer later this year, as it moves to replace coal according to the executive director at IEA, “75% of LNG growth is expected to come from the US over the next five years, while Australia and Qatar should also be major players”; The International Monetary Fund downgraded its outlook for global growth on Tuesday, global growth is now expected to plateau at 3.7% in 2018 and 2019, down from the 3.9% estimate the group made in July; Most major markets, including the U.S. and the euro area were downgraded, with the report suggesting that the US-China trade war and a slowing of emerging markets were to blame for the first downward revision since July 2016.
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