In US trade, markets retreated on the back of disappointing durable goods orders and a plunge in oil prices. Risk appetite was generally subdued with commodities and risk currencies losing ground. Stocks were choppy through most of the European session, until the durable-goods orders data triggered the sharp move lower.

Among the major averages, the Dow Jones Industrial Average was down 0.5% at 13126. The S&P was 0.5% lower at 1406 and the NASDAQ also shed 0.5% to finish at 3105.

Oil slid 1.8% after data showed a big spike in supplies, while copper slipped 2.3%. A stronger US dollar broadly weighed on commodities and will translate to a weaker start for local resource names. BHP's ADR is pointing to a 1.6% drop at the open to around $34.06. This is a key support region for the mining giant which has held on numerous occasions. The energy sector is also likely to come under significant pressure following the oil price drop.

Ahead of the open, we are calling the Aussie market down 0.5% at 4320. After yesterday's performance, this leaves us firmly in the support zone, which used to be resistance for the local market. As a result, we wouldn't be surprised if the market bounces off this level after the open. The 4300 to 4318 range is likely to attract some buying. Additionally, a weaker Aussie dollar will lend support to some sectors after AUD/USD slipped below 1.04 in US trade. Locally, there is nothing major on the economic front to look out for.

Market

Price at 7:30am AEST

Change Since Australian Market Close

Percentage Change

AUD/USD

1.0387

-0.0048

-0.46%

ASX (cash)

4320

-24

-0.54%

US DOW (cash)

13122

-83

-0.63%

US S&P (cash)

1405.0

-7.6

-0.54%

UK FTSE (cash)

5792.0

-64

-1.09%

German DAX (cash)

6983.0

-80

-1.13%

Japan 225 (cash)

10120

-43

-0.42%

Rio Tinto Plc (London)

33.16

-0.71

-2.08%

BHP Billiton Plc (London)

18.85

-0.41

-2.13%

BHP Billiton Ltd. ADR (US) (AUD)

34.06

-0.34

-1.6%

US Light Crude Oil (May)

105.50

-1.25

-1.17%

Gold (spot)

1663.8

-13.8

-0.83%

Aluminium (London)

2169.00

-27

-1.23%

Copper (London)

8349.00

-186

-2.18%

Nickel (London)

17575.00

-205

-1.15%

Zinc (London)

2000.00

-35

-1.72%

RBA Cash Rate to be decreased by 25bp (Apr) (%)

23.00

0

0.00%

IG Markets provides round-the-clock CFD trading on currencies, indices and commodities. The levels quoted in this email are the latest tradeable price for each market. The net change for each market is referenced from the corresponding tradeable level at yesterday's close of the ASX. These levels are specifically tailored for the Australian trader and take into account the 24hr nature of global markets.

Stan Shamu

IG Markets Market Strategist

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