A strengthening USD is the catalyst for overnight moves in bonds, shares and commodities. Conflicting currents have futures markets for Hong Kong and Australia in the red, while Nikkei futures are modestly higher. Locally, the AGM season rolls on and a number of earnings reports could see individual stocks on the move.
The USD made solid gains against the EUR and JPY as traders continued to factor an implied reflationary fiscal environment. This saw a pick-up in bond market volatility, with US ten years hitting a 12 month high at 2.30% before falling back. Commodity prices slumped, with varying results. Oil largely rallied back to erase most of the session losses. Gold continued its fall, as did other precious metals. Copper managed a gain, but most base metals fell. This is why futures traders believe Australian shares are under pressure today.
Uranium miner Paladin and currency provider OFX report earnings today, with expectations fairly muted. Investors may focus on AGMs for Nine Entertainment and Ainsworth. These consumer discretionary stocks may provide insights into the health or otherwise of Australian consumers.