Global equities lower on Friday night, Aussie dollar remains elevated, ASX futures down 47 points

Australia's ASX 200 continues to be range-bound between 5,750 and 6,000. Today's first chart illustrates this, and it seems that without the intensity of the Reserve Bank of Australia (RBA) rate cut bets that were on prior to last week's positive unemployment result, Australian shareholders have lost a bit of the cushion that was helping to keep the ASX afloat in anticipation of a cut to 2.00% rates in May. Having said that, there remains a 60% chance of a May rate cut based on interbank cash rate futures, and a few more negative sound bites from the Government on the May budget might help bolster expectations of a cut, once again. Minutes of the RBA's April meeting will be released tomorrow at 11:30am and then Australian consumer prices will be released at 11:30am on Wednesday, Sydney time. The Australian dollar (second chart, black line) remains elevated against the US dollar, due not only to the better employment numbers in Australia, but a reversal of the recent US dollar index rally (orange line).

Today's last chart is a quick sanity check of global equity index levels, which shows Germany coming off sharply. Concerns in Europe are elevating with regard to the Greek parliament's desire to reach agreement on reforms that would unlock further funding from creditors (ironically required in order to pay a scheduled ~1 billion euro repayment back to the International Monetary Fund). While the concept of putting together structural reforms to impress creditors to borrow money in order to pay them back is ludicrous (as the incumbent Greek government will gladly point out), it is the only way that Greece can remain a part of the Eurozone and continue to be eligible for foreign funding. It's a necessary evil that I'm sure will spell a more pleasurable alternative than an exit from the Eurozone for most Greeks, and that is why I believe an 11th-hour deal will be reached.

Year-to-date cash index CFD returns (last chart) show:

  • Germany's DAX up 19.38%;
  • Japan's Nikkei up 12.46%;
  • Australia's ASX 200 up 7.86%; and
  • The US's S&P 500 up 1.56%

Today‚Äôs charts are taken from the Rivkin Trader platform. 30,000 global instruments available to trade including FX, commodities, index, ETFs and international shares. Trade Australian share CFDs from just $8 or 0.10%. Click here or phone 1300 748 546 to open a Rivkin Trader account now.

Upcoming economic announcements: New Zealand CPI just out (lower than expected), ECB's quantitative easing statistics at 11:45pm, RBA's Glenn Stevens speaks in New York at 3am, all Sydney time.

This article was written by Scott Schuberg, CEO of Rivkin Securities Pty Ltd. Enquiries can be made via or by phoning +612 8302 3600.

comments powered by Disqus

DISCLAIMER: Rivkin aims to provide clear and simple information to those visiting our website. If any part of this disclaimer does not make sense, please phone Rivkin and ask to speak with a member of our Dealing and Relationship Management Team. Rivkin provides general advice and dealing services on securities, derivatives and superannuation (SMSF). Rivkin also provide SMSF administration and accounting services. Rivkin does not provide advice that takes into account your, or anybody else's, investment objectives, financial situation or needs. We strongly suggest that you consult an independent, licenced financial advisor before acting upon any information contained on this website. Investing in and trading securities (such as shares listed on the ASX) and/or derivatives (such as Contracts for Difference or 'CFDs') carry financial risks. CFDs carry with them various additional risks that differ from more simple securities such as fully-paid company shares. Some of these risks include not owning the underlying instrument from which a price is being derived, settling trades 'over the counter' with a financial institution rather than on a stock exchange, and using leverage to gain access to trades that may have a higher face value than your initial deposit. This risk of leverage means that it is possible to lose more than your initial investment. Our aim is to create more life choices for our clients, which means improving the wealth of clients throughout many market cycles by nurturing a relationship spanning many years. If you are not comfortable with your understanding of the risks involved before using a Rivkin product and service, please contact our office to seek further information or a Product Disclosure Statement, or make an appointment to sit with one of our friendly financial experts. It is in our interest for your Rivkin experience to be a rewarding and comfortable one. Rivkin is a trading name of Rivkin Securities ABN 87123290602, which holds Australian Financial Services Licence No. 332 802.