A lack of data leaves Asia Pacific investors in a vacuum today. Sandwiched between strong share market leads overnight and Fed chair Yellen’s testimony to Congress tonight, regional markets will likely reflect sentiment “on the ground” today. In Australia, stronger US stock prices are offset somewhat by weaker oil and gold.
European markets jittered again on bank fears, as Deutsche Bank plumbed another all-time low. However, the overall falls were contained. In the US, better than forecast Services and Composite activity indices, and stronger consumer confidence, fed into a positive post presidential debate environment. The SP500 index now sits just 2% below its all-time highs, inducing fear of missing out and fear of heights simultaneously.
Gold and oil prices tumbled despite a lower USD. The first presidential debate inspired a buying impulse in the currency, possibly based on candidate Trump’s calls for tariff protection for North American manufacturing. However, these gains were quickly reversed, as were the “safe haven” gains in gold. Oil price volatility saw previous session gains taken off the table. These commodity moves speak directly to the most over-traded sectors on the Australian market, and may see an otherwise positive day stained with red.