A review of the week past and the week ahead

Charts (1)


What mattered last week:

  • The S&P500 finished flat last week. reflecting a tug of war between positive economic data vs rising global coronavirus cases and a stalemate over stimulus talks.
  • As well as uncertainty ahead of the U.S. election and a still to be resolved Brexit deal.
  • Locally, the RBA delivered a significant dovish shift to its forward guidance, moving towards an inflation-targeting framework, similar to the Feds.
  • While China upped the ante in its diplomatic spat with Australia by verbally instructing imports of Australian coal and cotton to be halted.
  • In New Zealand, Prime Minister Jacinda Arden won re-election in a landslide result.
  • Volatility, as measured by the VIX index, closed higher at 27.4.
  • U.S. 10-year yields closed firmer near 0.75%.
  • Gold gave back last week’s gains closing -1.62% lower, near $1900.
  • Crude oil closed flat near $41.12/bbl.
  • The ASX200 built on prior week gains closing another 1.22% higher at 6176.8
  • In FX, the AUDUSD closed lower near .7080, impacted by policy changes in China and the dovish tones of the RBA.

For the week ahead, the key events are:

Australia: RBA meeting minutes (Tuesday).

  • RBA meeting minutes (Tuesday): The minutes are expected to be dovish however they are now largely outdated following RBA Governor Lowe’s ultra-dovish speech last week.

New Zealand: NZIER business confidence and global dairy auction (Tuesday), CPI, and balance of trade (Friday).

China: Q3 GDP, employment, fixed asset investment, industrial production, retail sales (Monday).

  • Q3 GDP (Monday): September quarter GDP is expected to rise by 3.2% qoq after an 11.5% qoq rise in the June quarter. This would take annual growth to 5.3% yoy.

Japan: Balance of trade (Monday), CPI, and Jibun manufacturing PMI (Friday).

U.S: Housing starts, housing permits (Tuesday), jobless claims, existing home sales, (Thursday), Markit composite flash PMI (Friday).

Canada: BoC business outlook survey (Monday), CPI, and retail sales (Wednesday).

Euro Area: German GFK consumer confidence (Thursday), German and EA Markit flash PMI’s (Friday).

  • EA Markit Composite Flash PMI’s (Friday): As a result of the rise in new coronavirus cases and a tightening of restrictions, a slight fall is expected from last month's 50.4 print.

UK: CPI (Wednesday), GFK consumer confidence, retail sales, and Markit Flash PMI’s (Friday).

More from Australia

From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.