Source: Bloomberg, TradingFloor.com
The debate, hosted by Hofstra University in New York, starts at 11am AEST. Photo: iStock
- Bank of New York Australia ADR Index little changed, BHP Billiton ADR up 0.3% to A$21.37 equivalent, 0.8% discount to last Sydney close, Rio Tinto ADR down 0.7% to A$42.13 equivalent, 16% discount to last Sydney close
- Gold futures for December delivery rose 0.2% to settle at $1,344.10. Bullion’s 60-day volatility fell to the lowest since October 2014, while aggregate trading in futures was 38% below normal for this time. Gold stocks were down 0.5% in Toronto on Monday. Gold may be in for a bumpy ride in the final quarter as Republican candidate Donald Trump now has a 40% chance of winning the presidential election and investors will be preparing for the possibility of higher US interest rates, according to Citigroup Inc. Gold stocks: GOR, NCM, NST, AQG, EVN, KCN, RMS, RRL, SAR, SLR
- Oil advanced as Saudi Arabia’s offer to cut output opened the door to a future Opec deal, though the kingdom doesn’t expect an agreement when members of the group meet this week. While Saudi Arabia and Iran didn’t reach an agreement after two days of preparatory talks in Vienna, the Saudis did offer to pump less crude if Iran caps output, according to two people familiar with the negotiations. The kingdom proposed to cut its production to January levels, Algerian Energy Minister Noureddine Boutarfa said Sunday. West Texas Intermediate for November delivery rose $1.45 to close at $45.93 a barrel on the New York Mercantile Exchange. Brent for November settlement climbed $1.46, or 3.2%, to $47.35 a barrel on the London-based ICE Futures Europe exchange. Oil stocks: WOR, WPL, STO, SEA, BPT, OSH, HZN, DLS, AWE, KAR, ORG, SXY
- Iron ore for Jan. fell as much as 1.3% on Dalian Commodity Exchange to 408 yuan/ton in retreat from its best week since August. Spot iron ore closed pretty much flat for the day. The world’s two largest iron-ore exporters, Brazil and Australia, will each add about 100m metric tons of supply through the end of the decade, boosting a global glut and hurting prices in a slump that will then force marginal miners to cut output, according to Citigroup Inc. SGX AsiaClear futures point to lower prices, with the contract for October trading at $55.67 a ton, January’s at $50.60 and next September’s below $45. Miners’ shares were mixed in Sydney on Monday, with BHP closing 0.1% higher, Rio Tinto Group rising 0.6% and Fortescue Metals Group Ltd shed 0.2%. Iron ore stocks: FMG, BHP, GBG, GRR, MGX, RIO, BCI, SDL
- Nickel for delivery in three months fell 1.2% to settle at $10,530, retreating from its biggest weekly gain in almost three months, as Citigroup Inc. forecast fourth-quarter price declines and said the impact of supply disruptions from the Philippines will probably be “underwhelming”. The world’s top miner of nickel ore is shutting operations that fall short of environmental or welfare standards. Ten mines have been suspended so far and Environment Secretary Gina Lopez said last week more than ten additional suppliers face closure. Stockpiles of aluminium tracked by the LME fell 0.5% on Monday, the most since March. Citigroup called for “caution” on aluminium due to a pick-up in Chinese output. Copper retreated 0.3% to $4,841 a ton ($2.20 a pound) in London. Copper futures for December delivery slid 0.1% to $2.1985 a pound on the Comex in New York. Copper stocks: PNA, OZL, SFR; Nickel stocks: IGO, WSA; Aluminium stock: AWC
- Bapcor (BAP): Offers NZ$3.30/share for Hellaby
- Cover-More (CVO): Agrees to buy Travelex Insurance Services for $105m; plans entitlement offer
- Monash IVF Group (MVF): Ironbridge said to sell stake, AFR says
- Origin Energy (ORG): Gets expressions of interest from Chinese suitors for its wind farm project
- Rio Tinto (RIO): Offers to buy back $3bn of bonds
- Labor says bank profits are too high: Labor is preparing a dossier on bad behaviour by banks, including fresh victim case studies, ahead of public hearings next week, says AFR
Broker upgrades and downgrades
- Fortescue Metals (FMG): Downgraded to underweight from equalweight at Morgan Stanley
- Newcrest Mining (NCM): Raised to buy from neutral at Goldman Sachs
Stock to watch
We covered a long opportunity over TCL.xasx near 10.60 earlier this month and it appears to have received solid support at these levels and we are currently witnessing a reversal in the weakness seen since July/August. The next resistance/profit target levels would be 11.30 and 11.50 if the current retracements continue.
TCL daily chart
Source: Saxo Bank. Create your own charts with SaxoTrader; click here to learn more
AUS200, AUDUSD and USDJPY
failed to push above the interim resistance level of 5,435 and sold off aggressively on the SYCOM open as the European session began. The US open wasn’t great either as it gapped down. The support level 5,400 of AUS200 was broken, therefore the downward momentum seems to be growing stronger. This sell-off looks like a profit taking given AUS200 enjoyed a nearly-300-point rally since mid-September. Ideal retracement levels would be 5,368 and 5,326.
AUS200 daily chart
The support level 0.76 handle held on as AUDUSD
recovered some of the previous day’s losses on the back of weakness from the US dollar. The US dollar index (DX) is likely to remain stuck in the range between the uptrend and the 200-day moving average. The major focus today would be on the US presidential debate at 11am local time and the Fed vice chair Stanley Fischer's speech at 1:15am.
AUDUSD daily chart
is forming a clear descending triangle pattern which usually indicates bearish outlook once we see a break out below the support level. In this case, the major breakout level would be 100, although there were a number of false breaks previously back in June and Aug. USDJPY may bounce off 100 for now but we are anticipating a proper breakout eventually.
USDJPY daily chart
Source: Saxo Bank
Today's Trade information sources: AFR, SMH, CNBC, BBG, WSJ, The Australian, Reuters
-- Edited by Susan McDonald
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