Australian Stock Market Indicators: Cautiously Subdued Trading ( 16 Janaury 2012)
The Australian Stock Market is seen getting on a rough start but could eventually take off after a mildly positive lead from the U.S. overnight. Analysts from CMC Markets, OptionsXpress of Charles Schwabb, and IG Markets have shared market key indicators for Monday.
Mildly positive lead from US overnight, according to Ric Spooner, Chief Market Analyst, CMC Markets, said could subdue the markets this morning as developments in Europe and the much-awaited release of Chinese economic data tomorrow
"Market reaction to S&P's downgrade of 7 Eurozone nations on Friday was relatively subdued. The downgrades were widely anticipated and already priced. However, they set a nervous early tone for this week's markets as we approach more significant hurdles in the evolution of the Eurozone crisis," Mr Spooner noted.
Ben Le Brun, market analyst from OptionsXpress said: "Dow Futures are currently pointing to further falls, although US markets are closed tonight for Martin Luther King holiday. Overall it maybe a case of feeling the brunt of the falls early in the session before turning to other markets in the region for direction this afternoon."
In terms of focus for the week ahead, Tuesday will be very interesting with a slew of Chinese data due to be released to the market. The GDP print will be of particular interest as we will begin to get a clear picture of what price China has paid to cool inflation and what impact a slowdown in the Eurozone is having on the Chinese economy overall. On top of that quarterly production reports for BHP, RIO, Fortescue and Woodside will be released this week. These will be interesting as we get into confession season a few weeks before reporting season. There is still speculation that weaker prices for bulk commodities may see some downgrades for some of our big materials stocks."
IG Markets analyst Stan Shamu has a more pessimistic view: "Based on Saturday morning's close for the futures, we are calling the Aussie market down 0.1% at 4191. However, risk currencies opened a touch weaker this morning, indicating that the equity market might be in for a tough start. We could see some caution being exercised in the Asian session, as investors wait to see the reaction to the downgrades in European trade. The US is on holiday today for Martin Luther King Day. On the economic front, traders will be looking out for ANZ job ads and home loans data due out at 11.30am."