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Manufacturing, Mergers and Meetings

A better than expected manufacturing environment in the US, mega-mergers and a slew of local Annual General Meetings could have investors jumping today. USD strength and a restart of bond selling overnight could produce a better result for Australian investors than the current futures market indication of a rise of just three points.

A stronger USD is cooling commodity markets. Effectively, commodity prices are higher this morning for producers outside the US, despite little change in the USD price of metals and oil. The modest drop in US crude prices may spark further energy sector selling today ahead of tonight’s inventory numbers.

The few company results last night included Kimberly Clarke. The FMCG manufacturer reported below consensus, bucking the trend so far. However traders were more focussed on mergers, with AT&T/Time Warner, TD Ameritrade/Scottrade and American Midstream/JP Energy deals taking centre stage. A read on manufacturing that showed activity accelerating into expansion provided a positive backdrop.

Today investors will hear from Tabcorp, GUD, Sirtex, McMillan Shakespeare, Fortescue and Bega Cheese, among others, at their AGMs. Outlook statements remain crucial in the current uncertain environment, and investors will listen up for any buybacks or potential acquisitions.

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