Markets continued to edge back from growth fears overnight. European and US stocks rallied alongside key industrial commodities oil and copper. The Yen, bonds and gold fell as investors moved away from safe havens, and the US dollar lifted towards two-year highs despite a presidential tweet calling for a 100 basis point cut in interest rates.
Asia Pacific futures traders gave a muted response. Nikkei futures are just 70 points higher, and Australia 200 futures only managed a 12 point lift. Hang Seng futures closed in the red. The Australian dollar was caught between a commodities uplift and a strengthening US dollar, and is trapped in a tight trading range just below US 68 cents.
The Reserve Bank of Australia releases the minutes from the most recent meeting today. Interest rate markets reflect little chance of a cut in September after back-to-back cuts in June and July. However two cuts by year end is the majority view, and the minutes will be scrutinised for further clues on timing.
The world’s biggest mining company, BHP, narrowly missed underlying profit forecasts. Although headline profits more than doubled and the dividend was lifted to 78 US cents, the shares may come under pressure today after the miss and management’s estimate that cost will rise this year.
Other reports so far include better than forecast profits from Tassal Group and Sonic Healthcare. Industrial services group Monadelphous disappointed with a 29% drop in earnings, and intellectual services group IPH also missed analysts’ estimates.