CMC Markets Weekly Report

Stocks in the U.S. closed largely unchanged on Friday, as investors reacted to lower jobs growth and concerns over the potential for the Syrian impasse to escalate into a situation that could disrupt oil supplies.

Stocks in the U.S. closed largely unchanged on Friday, as investors reacted to lower jobs growth and concerns over the potential for the Syrian impasse to escalate into a situation that could disrupt oil supplies.

The Dow Jones Industrial Average slipped 14.98 points, to finish at 14,922.50 while the S&P500 rose 0.90 points to end at 1,655.17. The Nasdaq was also largely unchanged up only 1.23 points to 3660.10.

The US added only 169,000 new jobs in August compared to expectations of 180,000. The July number was also revised down to 104,000. Average jobs growth in recent months has now been around 150,000 compared to the 200,000 run rate previously assumed. This adds to concerns that the increase in bond yields and mortgage rates over the past couple of months is already having some negative impact.

Markets have wound back expectations for the Feds tapering program and this is supporting international equity markets. Taper Light now looks the most likely alternative with the Fed making a very modest reduction in asset purchases at its meeting next week and then adopting a wait and see stance before making further cuts.

A statement by Russian President Putin that Russia would continue to support Syria's Assad regime and may provide further S300 missiles saw gold and oil prices move higher in Friday trading. Gold finished up $24.40 at $1391.9. Brent crude finished at $116.21 per barrel up $0.95.

Australian markets have opened with small gains after the election and as investors react positively to news that China's exports increased 7.2% in August compared to the previous year. With a coalition victory widely anticipated, there has been little reaction to the news of a change in government in early trading.

The Australian dollar is fetching .9195 cents against the US Dollar. Against the cross rates AUD JPY is trading at 91.54 while Euro Aussie is 1.4328 and GBP AUD is quoted at 1.7011.

Major economic releases this week include:

Tuesday: NAB Business Condition Index and China's Industrial Production and Retail Sales for August

Wednesday: Westpac Consumer Confidence

Thursday: Australian unemployment

Friday: US Retail Sales