Morning Notes

30/11/2018 - Argonaut Morning Note

U.S. equity markets fell overnight in anticipation of the coming U.S.- China trade meeting, outweighing the Federal Reserve’s dovish shift in their approach to interest rates. The Dow Jones fell 0.1% to 25,339 whilst the S&P 500 fell 0.2% to 2,738; President Donald Trump cancelled a one-on-one meeting with Vladimir Putin at the Group of 20 summit due to Russia’s capture of Ukrainian ships and sailors in the Kerch Strait near Crimea this week, according to Bloomberg; Crude oil prices climbed overnight as Russia has expressed a willingness to join Saudi Arabia in curbing global oil supply. Brent gained 0.9% to 59.28 US$/bbl and WTI increased 2.3% 51.45 US$/bbl; President Trump claims he’s open to a trade deal with China ahead of the planned meeting with Xi Jinping (Bloomberg); Copper added 0.1% to 6,248 US$/t overnight as plant closures and low inventories prompted traders to cover short positions; U.S. Shale explorers will likely cut spending budgets next year for the first time since the last price crash as crude spirals down again, according to Bloomberg.

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29/11/2018 - Argonaut Morning Note

 U.S. markets rallied overnight, the Dow Jones finished 2.5% higher to 25,336 whilst the S&P 500 gained 2.3% to 2,744; Russian President Vladimir Putin is showing no sense of urgency around crude oil production cuts on the claims that Russia is fine with the commodity priced at approximately 60 US$/bbl, according to Bloomberg; Oil prices fell overnight due to an unexpected increase in U.S. crude inventories adding to concerns of a supply glut; Russia is preparing to start buying aluminium for state stockpiles as their producer, United Co. Rusal is hurt by U.S. Sanctions; The U.S. gold price gained 0.5% to 1,220.7 US$/oz overnight as federal reserve chair, Jerome Powell claims the federal funds rate was below neutral estimates and suggested fewer rate hikes lie ahead; Traders are hedging against potential price swings in Asian markets should President Donald Trump fail to cut a trade deal with China’s Xi Jinping this week;  Base metal prices finished stronger overnight on the London Metals Exchange, the largest gains were observed in Copper and Zinc increasing 1.4% to 6,244 US$/t and 1.2% to 2,545 US$/t respectively.

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28/11/2018 - Argonaut Morning Note

U.S. Stocks increased as investors assessed the chances of an agreement in the U.S. - China trade war, President Donald Trump and Xi Jinping are set to meet Saturday evening in Buenos Aires. The Dow Jones gained 0.4% to 24,749 overnight; Materials was the worst performing sector in the S&P 500 Index overnight, the space was heavily weighed down by the rally in the U.S. dollar. Overall, the S&P 500 increased 0.3% to 2,682; The Trump administration plans to order refiners to use 15 billion gallons of conventional renewable fuels such as corn-based ethanol for 2019; Saudi Arabia urges Russia to collaborate in cutting crude oil production as an attempt to revive the global oil market; Zinc has fallen for a third straight day on the London Metals Exchange as the U.S. signalled plans to raise tariffs on Chinese products, escalating concerns regarding global growth. Zinc decreased 1.4% overnight to 2,514 US$/t.

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27/11/2018 - Argonaut Morning Note

US markets recovered from what was considered the worst week of trading for November 2018, the Dow Jones added 1.5% to 24,640 whilst the S&P 500 gained 1.6% to 2,673; The price of Iron ore has declined due to the sinking mill profitability in China prompting steelmakers to reduce raw material consumption, following slumps in crude oil and copper prices; Saudi Arabia responds to pressures from U.S. President Donald Trump to drive oil prices lower by increasing their daily crude output to 11.2 million barrels per day, according to Bloomberg; Nickel decreased 0.4% overnight on the LME to 10,804 US$/t, the commodity is heading for a sixth straight monthly loss amid signs of surging supply from Indonesia and mounting concerns over Chinese demand; The Aluminium price is expected to face headwinds in the near future due to its large exposure to the automotive sector and the likelihood of further delays in U.S. Sanctions on Russia for Aluminium production, according to Bloomberg.

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26/11/2018 - Argonaut Morning Note

The U.S. share markets were weaker on Friday in a shortened trading session where the energy sector fell 3.3% in response to retreating oil prices. The Dow Jones and the S&P 500 declined 0.7% to 24,286 and 2,633 respectively; Investors are expecting this week’s meeting between President Donald Trump and Xi Jinping to be a “watershed” moment for emerging markets, according to Bloomberg; U.K. Prime Minister, Theresa May obtained her Brexit divorce deal with the European Union at the Brussels summit on Sunday; Taiwanese President Tsai Ing-wen announced plans to step down as party chairwoman on Saturday following sweeping midterm losses against a rival party that favours closer relations with China; Australian shares are expected to start the week lower as a result of tumbling oil and iron ore prices, losses in equities for Europe and the U.S. The ASX all Ords finished up 0.4% on Friday at 5,793.

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