News & Analysis
Stocks rebound – Dow adds 401; GBP continues lower; ECB holds rates; U.S GDP due tonight
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23:30 USD Advance GDP
01:00 EUR ECB President Draghi Speaks
U.S stocks recovered overnight, the Dow added 401, the S&P500 49.47 and the Nasdaq closed 209 pts higher after Wednesday nights sell-off. Tech kicked off the rebound. “What happened yesterday was the market got way oversold,” said Tom Essaye, founder of The Sevens Report. “Was a decline on earnings warranted? Yes, but not 10%.” “The market is now correcting that a bit,” Essaye said.
It’s been a painful month for stocks the Dow and S&P 500 were down 5.6% and 7.2% for October. The Nasdaq had lost 9.1%. There’s potential for more volatility on Friday after Google-parent Alphabet and Amazon sliding after releasing their quarterly results.
Shares in Europe closed higher, Europe’s autos stocks led the gains Thursday afternoon, adding 3.15% amid earnings news. France’s PSA Peugeot Citroen jumped after its quarterly earnings were well received by investors. tire maker Continental climbed 7.65% after announcing that its third-quarter adjusted operating result would higher than previously forecasts. The DAX closed 115 pts higher and the FTSE added 41 pts.
Oil reversed a weaker Asian session to close higher. Buyers took comfort in rallying equity markets. Supply concerns – Saudi Arabia’s OPEC governor said on Thursday the oil market could face oversupply in the fourth quarter. “The market in the fourth quarter could be shifting towards an oversupply situation as evidenced by rising inventories over the past few weeks,” Adeeb Al-Aama told Reuters. USOUSD closed 57 cents higher at 66.96.
Gold ended 2.50 lower after buyers were stopped again by 1234.90. Higher stocks put the brakes on the rally. The USD had a mixed session to the majors, it made gains to the EUR and GBP as Brexit issues continued, the EUR dropped 15 pips after giving back a solid looking rally. The GBP lost 65 pips. Data wise, Core Durable Goods Orders missed expectations hitting 0.1% and as expected the ECB held rates at 0.00%. The AUD ticked higher to the USD closing 18 pips higher. The USD closed higher to the JPY and CAD despite the data miss. The Yen was mixed to risk, GBP fell due to local weakness, the EUR and AUD held gains.
Flat Asian session so far with little movement from the majors. The ASX200 is trading 15 points higher. Based on last night’s rally and a not overly string Yen you’d think the Nikkei should be higher on open this morning.
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Sources; CNBC – All times are AEDT
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