Morning Notes

01/11/2018 - Argonaut Morning Note

Last night was the first back to back improvement in the US Markets in a month with the Nasdaq up 2%, the Dow and the S&P 500 both posting 1% gains. The USD added a 16-month high with all positives stemming from a stream of strong corporate earnings results and improved sentiment; Global oil prices fell on Wednesday as US crude stocks rose for a sixth successive week. According to the US EIA, inventories rose by 3.2 million barrels last week which was below expectation of 4.1 million barrels. Brent down 1.2% and WTI down 1.3%; Base metals closed mostly lower, nickel and zinc were among the worst performers down 2.3% and 2.0% respectively.

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31/10/2018 - Argonaut Morning Note

US equity markets rallied hard with the Dow jumping 1.8% as Trump suggested a deal possible with China on the Trade tariffs; Base metals were hit hard overnight, all LME metals were lower, Copper fell 2% and Zinc 3% as the USD rose further and the DXY above 97; Gold miners finish their best month of the year, with Bullion prices set to end October with the first monthly gain in seven, as a sell-off in equities and concerns over global economic growth boost the appeal of the metal as a safe haven; Trick or treat, the last day of October ending a very volatile month. The S&P is down 8%, Nasdaq -11%. Asian markets also falling hard, Nikkei -11%, Hang Seng -12%, CSI -10%, while the ASX, one of the best down 6%

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30/10/2018 - Argonaut Morning Note

US Stocks Slumped – Major indexes are flirting with corrections on news that the Trump administration is contemplating new tariffs against China. The Dow Jones fell 1% to 24,443 whilst the S&P 500 declined 0.7% to 2,641; Trump plans to put levies on all remaining Chinese imports if his talks with Xi Jinping next month fail; the value of all goods from China not currently subject to U.S. duties is about $257 billion; The U.S. Treasury said government borrowing this year will more than double from 2017 to $1.34 trillion as the administration finances a rising budget deficit. The department expects to issue $425 billion in net marketable debt from October through December, lower than the $440 billion estimated in July; China granted refiners another round of export quotas, supporting the view that crude demand will remain strong compared with last year. Refiners have 12.7 million tons of gasoline and 16 million tons of diesel exports this year.

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29/10/2018 - Argonaut Morning Note

Global equities fell sharply on Friday with the Dow down 296 points and seven of the eleven S&P 500 sectors were down at least 10% from their 52-week highs, including energy, materials and financials; These declines were enough to offset better than expected results on US economic growth. The Commerce Department reported that the US economy grew at 3.5% in the third quarter, above expectation of 3.4%;  Despite a generally positive quarter of corporate results, bearish sentiment seems to be a recurring theme, with investor’s more concerned about the prospect of a hike in US rates by the Fed as we move past “peak earnings” in the cycle;  Australian markets are set to be guided by key economic news over the course of the week with headline CPI, building approvals, export/import figures and retail trade numbers all set to be released by Friday. 

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26/10/2018 Argonaut Morning Note

US stocks surged back into positive territory, with the Nasdaq posting its biggest increase since March only a day after global equities were sent negative for the year. A raft of US earnings helped drive the market higher, international Paper jumped 10%, and Twitter rose 15%, while the USD rose with investors fleeing the Euro and the GBP; Sentiment has been tested of late, with global stocks set for their worst month in more than six years. Investors remain apprehensive as earnings results, while mostly stellar, come with warnings about the future impact of tariffs and rising costs; The Saudi’s yesterday came close to acknowledging that the murder of Jamal Khashoggi was premeditated as pressure mounted on the country to provide a credible explanation to the killing that shook markets over the week; Tech giants Amazon and Google’s parent, Alphabet both sank on earnings estimates which were well below par. Amazon and Alphabet delivered strong profit results but underwhelming sales results and expectations running into the busy 4th quarter; China is set to cut some of its oil trade with Iran after vowing for months to resist US sanctions on the exports.

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