The stock market will open lower this morning following international risk off moves driven by the prospect of a gradual exit from global central bank stimulus.

International bond markets appear to at a stage where nervousness about the prospect of central bank stimulus ultimately ending is outweighing the positive impacts of any near term moves to temporarily extend that stimulus. This is reflected by bond yields rising and gold crashing on news of unsourced reports that the ECB is ultimately planning a taper program to wind back its QE asset purchases. Markets are looking past the likelihood that the current March 2017 deadline for the ECB’s current QE program will actually be extended for at least six months.  Bond investors don’t want to be caught being late to respond to a scenario where the US Fed leads a gradual exit from current global central bank stimulus.

The significant moves in bond yields, gold and the US Dollar last night means that the local stock market is less likely to repeat yesterday’s performance where it recovered from a weak opening. Last night’s moves may see investors remain cautious about the possibility of follow through selling in bonds; gold and stocks over coming days.

Judging by yesterday’s lack lustre trading in CBA shares ; it seems there was precious little in the way of tangible outcomes from yesterday’s banking inquiry to influence investor thinking on the operating environment for the banking industry.

Probably the most concrete possibility is the potential to free up competition by allowing portability of bank account numbers. This would save customers the hassle of reinstating all their direct payment and credit arrangements when they switch banks.

It’s hard to argue with moves to improve competition like this from a public policy perspective. For banks, the risk will be increased customer churn perhaps more like the mobile phone and energy companies. That should increase price competition. No doubt there would be winners and losers in this. At this stage though, there’s a long way to go before this general concept becomes a specific regulatory possibility.  It will need to be done in a way which allows both big banks and smaller institutions to transfer customer information effectively and securely.