Steady trade as brokers wait for data
On Sunday the benchmark S&P/ASX 200 Futures Index showed the market was tipped to open eight points higher for the start of the second full trading week of the year.
It comes as market watchers prepare for a slew of economic data releases this week, covering the job market, inflation, lending, and consumer sentiment.
CommSec economist Craig James said there were no great drivers for the Australian market on Monday, after mixed results on Wall Street.
"It's going to be a fairly soft start to proceedings off the back of a fall in the oil price, the gold price; iron ore was down and base metal prices were mixed as well," he said.
The Australian market had recently tended to follow the Toronto stock exchange, which finished slightly higher on Friday. "Toronto finished with a slight gain and our futures market is pointing to a slight gain," he said.
Among the economic data to be released, housing finance and credit card debt lending (for November), and ANZ's job advertisements data (December) will be published on Monday.
TD Securities inflation gauge (December) will also be released on Monday.
January's consumer sentiment data will be released on Wednesday, while December's employment figures will come out on Thursday.
"Overall a mixed bag of results is likely," Mr James said. "We expect that the data will show inflation is contained, job ads and housing finance were flat, credit card debt remains on the outer."
US stocks closed in mixed territory on Friday as tepid earnings from Wells Fargo kept the markets restrained.
At the close of trade on Friday, the Dow Jones Industrial Average was up 17.28 points (0.13 per cent) at 13,488.50.
The broad-based S&P 500 was flat at 1472.09 and the tech-heavy Nasdaq Composite rose 3.87 (0.12 per cent) to 3125.63.
Europe's main stockmarkets closed with modest gains on Friday, with London's FTSE 100 index of leading companies posting the largest increase of 0.33 per cent to 6121.58 points.
Investors will be carefully monitoring US Federal Reserve chairman Ben Bernanke's speech on Monday and the release of Chinese GDP figures on Friday.
Frequently Asked Questions about this Article…
The sharemarket was expected to open slightly higher, with the S&P/ASX 200 futures pointing to about an eight-point gain that would keep the market near 4,700 points. Investors watch the open as futures reflect overnight moves in global markets and early sentiment ahead of local economic data releases.
Key releases include housing finance and credit card lending for November, ANZ's job advertisements for December, TD Securities' inflation gauge for December (all on Monday), January consumer sentiment (Wednesday) and December employment figures (Thursday). These reports cover lending, jobs, inflation and consumer confidence — all market-sensitive topics.
CommSec economist Craig James noted recent falls in oil and gold, weaker iron ore and mixed base metal prices. Because commodity prices influence earnings and sentiment for resources and broader market sectors, declines can lead to a softer start for the ASX, especially for commodity-linked stocks.
Craig James said there were no great drivers for the Australian market on Monday after mixed results on Wall Street. He described a likely 'fairly soft start' driven by weaker commodity prices and noted the market had been tracking the Toronto exchange's modest gains.
US stocks closed mixed — the Dow rose slightly to 13,488.50, the S&P 500 was flat at 1,472.09 and the Nasdaq ticked higher to 3,125.63 — as tepid earnings from Wells Fargo restrained markets. Europe's main indexes posted modest gains, with London’s FTSE 100 up 0.33%. Global closes set the tone for the ASX open and investor sentiment.
Wells Fargo's tepid earnings were flagged as a restraining factor for US markets. Investors were also watching US Federal Reserve chairman Ben Bernanke's speech and the release of Chinese GDP data later in the week as potential market-moving events.
The article quotes an expectation of a 'mixed bag' of results: inflation likely contained, job ads and housing finance broadly flat, and credit card debt remaining subdued. That mix could lead to a range-bound market reaction rather than a decisive trend.
Focus on the scheduled data points highlighted — housing finance, job ads, inflation gauges, consumer sentiment and employment — and key global events like central bank speeches and Chinese GDP. These are the most likely drivers mentioned in the article that influence market direction in the short term.
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