The stock market has mixed leads as traders weigh a record close on Wall Street against trade doubts, technical resistance and weakness in key commodities.
ASX SPI200 index futures rallied 27 points or 0.4 per cent to 6726 as US stocks inched higher on Friday. A positive open would pit the ASX 200 against strong overhead technical resistance at the 6740-6750 level. The benchmark index has stalled around that level four times since late September. Fifth time lucky?
No such problems on Wall Street, where stocks pushed further into uncharted territory. The S&P 500 rose eight points or 0.26 per cent on Friday to seal a fifth week of gains. The US benchmark added 0.9 per cent last week. The Dow put on six points or 0.02 per cent for a weekly tally of 1.2 per cent. The Nasdaq added 41 points or 0.48 per cent on the day, and 1.1 per cent during a sixth weekly advance.
US gains were capped by negative news on trade. Stocks hit their lows for the session after President Donald Trump denied agreeing to roll back tariffs on Chinese imports. Officials from both camps said on Thursday they had a deal to wind back tariffs in simultaneous phases. Trump ramped up trade doubts over the weekend, telling reporters there had been “a lot of incorrect reporting” and he would only make a deal if it was “the right deal”.
Chinese stocks fell on Friday, but were cushioned by trade figures that were stronger than expected. The Shanghai Composite slid 0.49 per cent. October exports were down 0.9 per cent on the same month last year, a milder fall than the 3.9 per cent economists anticipated. Imports eased 6.4 per cent, also less than expected.
The ASX 200 rose last week for the fourth time in five weeks, but stalled on Friday as bond proxies and gold stocks fell. The index closed three points or less than 0.1 per cent weaker.
Declines in iron ore and industrial metals look like headwinds for resource stocks today. The spot price for iron ore landed at China’s Tianjin port dived $2.60 or 3.2 per cent to $US79.90 a dry ton amid reports inventory at ports reached a six-month high. BHP’s US-listed stock gave up 1.32 per cent and its UK-listed stock 1.43 per cent. Rio Tinto shed 2.52 per cent in the US and 2.92 per cent in the UK.
A short-covering rally in aluminium stalled following a 6 per cent rise in two weeks. Aluminium slid 0.3 per cent on the London Metal Exchange from a two-month peak. Copper fell 0.9 per cent, lead 0.3 per cent, nickel 0.1 per cent and zinc 0.1 per cent. Tin gained 0.9 per cent.
Gold extended its worst weekly loss in two and a half years. Gold for December delivery settled $3.50 or 0.2 per cent weaker at $US1,462.90 an ounce. The traditional haven lost 3.2 per cent over the week as trade expectations rose and treasury yields and the greenback climbed.
Oil climbed to a six-week high after a report showed a decline in the number of rigs drilling in the US. Brent crude rose 22 cents or 0.4 per cent to $US62.51 a barrel. Active rigs decreased by seven last week to 684, according to figures from Baker Hughes.
The dollar opened this morning less than 0.1 per cent higher at 68.63 US cents.
Not a lot on the economic calendar over the next 24 hours, with the Veterans Day bank holiday tonight in the US capping activity. US stock and commodity markets will trade as normal. Highlights this week on the domestic calendar include business confidence tomorrow, consumer sentiment and wage growth on Wednesday, and jobs figures on Thursday.