CMC Markets Weekly Report
US stocks fell on Friday and posted their biggest weekly decline since June as investors focused on when the Federal Reserve would begin to scale back its stimulus. The Dow Jones Industrial Average dropped 0.47 percent to 15,425.51. The S&P 500 declined 0.36 percent to 1,691.42 and the Nasdaq Composite fell 0.25 percent to 3,660.11.
US stocks fell on Friday and posted their biggest weekly decline since June as investors focused on when the Federal Reserve would begin to scale back its stimulus. The Dow Jones Industrial Average dropped 0.47 percent to 15,425.51. The S&P 500 declined 0.36 percent to 1,691.42 and the Nasdaq Composite fell 0.25 percent to 3,660.11.
In commodity markets, Oil prices rose after China posted upbeat industrial output data that bolstered the outlook for the world's top energy consumer. The data came as the International Energy Agency (IEA) trimmed its outlook for world oil demand growth over the next 18 months and highlighted threats to the dominance of producer cartel OPEC.
Brent North Sea crude for delivery in November climbed $US1.45 cents to stand at $US1,06.11 a barrel in London midday deals. New York's main contract, West Texas Intermediate for September, jumped $US2.57 to $US105.97 a barrel.
Gold edged higher while platinum notched an eight-week high as stronger Chinese economic data bolstered investor interest in both metals. Gold for December delivery, the most active contract, on Friday rose $US2.30, or 0.2 per cent, to settle at $US1,312.20 a troy ounce on the Comex division of the New York Mercantile Exchange. Gold prices are also up 0.2 per cent on the week.
Base metals on the London Metal Exchange closed higher after prices surged following another round of upbeat Chinese economic data that stoked investor hopes for better demand from the world's top metals consumer. At the close of open-outcry trading in the London ring on Friday, LME three-month copper was 1.2 per cent higher on the day at $US7,274 a metric ton, it's highest closing price since early June. Aluminium closed up 1.6 per cent at $US1,870 a ton.
The Australian dollar is higher as the currency continues to extend its gains following the release of strong Chinese data. This morning, the local unit was trading at 91.94 US cents, up from 91.40 cents on Friday.
China's industrial production growth accelerated in July to a five-month high of 9.7 percent year-on-year, the Chinese government said.
In economic news on Monday, the Australian Bureau of Statistics (ABS) releases the lending finance figures for June.
In equities news, Newcrest Mining (NCM), UGL and JB Hi-Fi (JBF) are due to post full year results, while GPT Group (GPT) is expected to announce first half results and James Hardie Industries (JHX) is slated to release its first quarter results and hold its annual general meeting.
Frequently Asked Questions about this Article…
US shares fell and posted their biggest weekly decline since June as investors focused on when the Federal Reserve might begin to scale back stimulus. The Dow, S&P 500 and Nasdaq all slipped (the Dow fell about 0.47% to 15,425.51, the S&P 500 fell about 0.36% to 1,691.42 and the Nasdaq fell about 0.25% to 3,660.11). 'Scaling back stimulus' means the Fed could reduce bond buying or other support, which can increase market volatility and affect stock prices, so investors should stay informed about Fed statements and economic data.
Oil prices rose after upbeat Chinese industrial output data lifted demand expectations. New York’s West Texas Intermediate (WTI) jumped about $2.57 to US$105.97 a barrel, while Brent crude climbed roughly US$1.45. The International Energy Agency also trimmed its near-term demand outlook and flagged challenges to OPEC’s dominance, so energy investors should watch both demand signals from China and global supply-side developments.
Gold edged higher to settle at US$1,312.20 an ounce (up about US$2.30) and was up roughly 0.2% on the week, while platinum hit an eight-week high. Base metals rallied: LME three-month copper rose about 1.2% to US$7,274 a metric ton and aluminium rose 1.6% to US$1,870 a ton. Strong Chinese industrial data tends to boost demand expectations for metals and can support prices, so commodity-focused investors should monitor Chinese activity and inventory trends.
The Australian dollar strengthened after the positive Chinese data, trading around 91.94 US cents, up from about 91.40 US cents. Since Australia’s economy and commodity exports are linked to Chinese demand, strong Chinese data often lifts the AUD.
China reported industrial production growth of 9.7% year‑on‑year in July, a five‑month high. For global markets, stronger Chinese production can signal higher demand for energy and industrial commodities, supporting oil, metals and resource-related stocks, while also influencing currency moves like a stronger Australian dollar.
The article notes several Australian companies due to report: Newcrest Mining (NCM), UGL and JB Hi‑Fi (JBF) are set to post full‑year results; GPT Group (GPT) is expected to announce first‑half results; and James Hardie Industries (JHX) will release first‑quarter results and hold its annual general meeting. Everyday investors should watch revenue, profit, guidance and any commentary on demand or commodity prices where relevant (for example, miners will be sensitive to metal and energy prices).
The Australian Bureau of Statistics (ABS) is due to release lending finance figures for June. Lending finance data can give insight into household and business borrowing trends, which influence economic growth expectations, housing and banking sectors, and broader market sentiment.
The article highlights a dichotomy: commodities rallied on stronger Chinese data while US equities fell amid Fed stimulus concerns. This suggests markets are reacting to both stronger global demand prospects (supporting commodities) and potential monetary policy tightening (putting pressure on stocks). Investors can respond by staying diversified, monitoring central bank cues and key economic data, and focusing on companies and sectors most exposed to these forces rather than making impulsive trades.
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