Last night the Aussie dollar was smashed along with iron ore and coal, gold dipped below $1,250 at one point, Crude is below $93.00 and copper tanked 6 cents to $3.10.
The common denominator is a strong US dollar and while its strength will ebb and flow it seems a move is afoot for concerted strength which will weigh on markets around the globe.
As noted yesterday I’m short Aussie and staying that way. For the moment though the Aussie is under pressure at the bottom of the range sitting at 0.9203 but just holding above the 200 day moving average at 0.9180.
My sense is the Aussie is heading lower, it is a very crowded trade.
Euro buyers are back after the monster sell off recently and it sits at 1.2938 this morning while GBP is at 1.6103 and the Yen is at 106.23.
It might be time for a bounce on the dailies for Euro but the overall trend is lower.
Turning to the US overnight and even with the big Apple announcements stocks were lower. Indeed Apple fell 0.4% on the day which isn’t much but it had been up 4% at one stage. On the Indices the Dow closed 97 points lower at 17, 014 for a loss of 0.57%, the Nasdaq was off 0.88% at 4,552 and the S&P 500 lost 14 points or 0.68% to close at 1,988.
In terms of data in the US the small business NFIB optimism index was released printing 96.1 the second highest level since 2007 colleague Myles Udland of BI US reports with solid capex plans.
In Europe stocks were also lower across the board with the FTSE not too spooked by BoE Governor Mark Carney intimating that rates could rise soon closing down 0.08% at 6,829. On the Continent the DAX was 0.48% lower at 9,711, the CAC dipped 0.51% to 4,452 while stocks in Milan and Madrid fell 0.68% and 1.36% respectively.
On futures markets locally after a reasonable performance in the Physical ASX yesterday the SPI 200 September and December futures both fell 17 points to 5586.
I’m staying short.
In Asia yesterday Shanghai was flat at 2,327, the Hang Seng dipped 0.2% to 25,190 and the Nikkei rose 0.28% to 15,749. Market focus today will be on New Loans in China and Machinery orders in Japan.
On commodities iron ore and coal were both poll-axed overnight. September iron ore fell 96 cents a tonne to $83.70 but December futures lost $1.76 to $82.24. The big miners are grinding smaller miners into the dust it seems but they might need to be careful what they wish for. December Newcastle coal dropped 90 cents to $66.75 a tonne.
Nymex crude sits at $92.75, copper dropped 6 cents to $3.10 a pound and gold is at $1,256. On the Ags wheat fell 0.82%, corn lost 1.15% and soybeans were 0.28% lower.
On the data front today we get the Westpac consumer sentiment index for September, the Chinese data noted above and then tonight UK inflation hearings.