Australian markets may come under pressure when they reopen following the Australia Day weekend. Other Asia Pacific indices sold off yesterday, catching up to Friday’s US selloff. US indices have spent much of the day today in negative territory although the Dow keeps trying to inch up into positive territory. Perhaps more worrisome for the S&P/ASX is that the resource weighted Canadian market (S&P/TSX) has dropped off sharply again today with both the metals and energy commodity groups under pressure. On the other hand, AUD has been the strongest currency to start the week as it bounces back from recently depressed levels as it takes advantage of a rotation in currencies from defensive plays back to risk markets as the global economy builds strength. NZD and CAD have also been on the rebound today while gold, silver, JPY and CHF have been giving back some of their recent gains. Tomorrow’s UK GDP report could attract some attention from traders looking for insight into how much pressure the Bank of England is under to start normalizing interest rates. Strong data of late has lit a fire under GBP while dragging on the FTSE. The main focus for this week remains on Wednesday’s FOMC decision and the RBNZ decision an hour later (but Thursday morning local time). In both cases, the central banks may give an indication of how consistently and/or aggressively they intend to move on normalizing monetary policy through tapering or potential interest rate increases. Corporate News Apple $14.50 vs street $14.09, sales $57.5B vs street $57.4B, revenue guidance falls short $42-$44B vs stret $46.1B Seagate Technology $1.32 vs street $1.39 Rumour has it that Martin Marietta is close to a deal to acquire Texas Instruments Kansas City Southern raises dividend 30% to $0.28 Economic News Significant announcements released overnight include: US new home sales 414K vs street 455K Germany IFO Bus climate 110.6 vs street 110.0 Germany IFO current assess 112.4 as expected Germany IFO expectations 108.9 vs street 108.0 Upcoming significant announcements include: 10:00 am AEDT Australia leading indicator previous 0.5% 11:30 am AEDT Australia NAB confidence previous 5 11:30 am AEDT Australia NAB conditions previous (3) 4:30 pm AEDT India repurchase rate street 7.75% no change expected 9:30 am GMT UK GDP street 2.8% vs previous 1.9% TBA Turkey interest rate decision 4.50% no change expected 8:30 am EST US durable goods orders street 1.8% 8:30 am EST US durables ex transport street 0.6% 10:00 am EST US consumer confidence street 78.0 10:00 am EST US Richmond Fed street 13.0

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