Morning Market Update - 30 June 2017


Pre-Open Data


Key Data for the Week

Key economic data released this week:

  • Thursday – US – Gross Domestic Product increased at an annual rate of 1.4% in the first quarter of 2017, higher than the initial estimate of 1.2%.
  • Thursday – EUR – Economic Sentiment Indicator rose to 111.1 in June, its highest level since August 2007. The increase was driven by an increase in both industry and consumer confidence.
  • Friday – UK – Gross Domestic Product
  • Friday – EUR – Consumer Price Index

Australian Market


The Australian market followed Wall Street higher yesterday, with strength from the banks and miners. Westpac and ANZ were among the best performing, closing up 2.0% and 2.4% respectively.

Oil prices rallied to their highest point in a week after news there was a small weekly decline in US production. Oil Search finished up 4.5% and Beach Energy closed 2.6% higher.

Miners also lifted yesterday, following another rally in the iron ore spot price, which shot up 4.4% to US$62.33 a tonne. Fortescue added 2.8%, whilst heavyweights Rio Tinto and BHP climbed 3.3% and 2.6% respectively.

The Australian futures market points to a 1.17% fall today, being driven by weak leads from overseas markets.

Overseas Market

The prospect of higher interest rates around the world and tightening of monetary stimulus in the coming months, following hawkish comments by the Bank of England (BoE) and the European Central Bank (ECB) earlier in the week, weighed on sentiment in equity markets.

In the US, losses in the Technology sector more than offset strong gains from the big banks, who will benefit from higher interest rates and a decision from the Federal Reserve to allow capital repurchase programs from banks. The Dow fell 0.8% and the S&P 500 dropped 0.9%.

The Stoxx Euro 600 ended the day down by 1.34%, with the majority of sectors in the red. HSBC bucked the trend, closing at a four year high, buoyed by the wider rally in bank shares and a favorable analyst report published by Morgan Stanley.

CNIS Perspective

For the first time in many years, European Central Bank President Mario Draghi is finally talking positively about the Eurozone economic landscape and now has the runs on the board to prove it.

While its recovery started later than other advanced economies, the Eurozone has now enjoyed sixteen straight quarters of growth, spread across most of Europe, with around 6.5 million jobs being created.

Along with renewed political stability in Europe, the economic recovery now sees Draghi talking about tapering their quantitative easing policy as early as September, and normalisation of, or higher, interest rates.

If the USD is any example, the Euro could be in for a decent rally. The USD strengthened significantly during the QE tapering period of mid-2014 to early 2015, but has shown little gain since the end of the tapering period, despite three interest rate hikes.


Contact Us

Should you wish to discuss this or any other investment related matter, please contact our Investment Services Team on (02) 4927 8844.


The material contained in this publication is in the nature of general comment only, and neither purports, nor is intended to be advice on any particular matter.  Persons should not act or rely upon any information contained in or implied by this publication without seeking appropriate professional advice which relates specifically to his/her particular circumstances.  Cutcher & Neale Investment Services Pty Limited expressly disclaim all and any liability to any person, whether a client of Cutcher & Neale Investment Services Pty Limited or not, who acts or fails to act as a consequence of reliance upon the whole or any part of this publication. Cutcher & Neale Investment Services Pty Limited ABN 38 107 536 783 is a Corporate Authorised Representative of Cutcher & Neale Financial Services Pty Ltd ABN 22 160 682 879 AFSL 433814


Topics: Investment, CNIS, Europe, Euro, Market Update, Eurozone

Recent Posts

Blog Tags

see all