Markets Overview
- ASX SPI 200 futures little changed at 9,003.00
- S&P 500 up 0.5% to 6,664.01
- Dow Average up 0.5% to 46,190.61
- Aussie up 0.1% to 0.6494 per US$
- US 10-year yield rose 3.4bps to 4.0088%
- Australia 3-year bond yield fell 6.3 bps to 3.31%
- Australia 10-year bond yield fell 5.3 bps to 4.10%
- Gold spot down 1.7% to $4,251.82
- Brent futures up 0.4% to $61.29/bbl
Economic Events
Australian Prime Minister Anthony Albanese is expected to meet US President Donald Trump on Monday in Washington for talks that will include discussions over the supply chain of rare earth materials.
US equity futures rose 0.3% in early Asian trading, after Wall Street closed last week higher as President Donald Trump moved to ease concerns over trade tensions.
Asian stocks are poised for a mainly positive open, with contracts pointing to gains in Tokyo and Hong Kong and a flat open in Australia. The greenback was steady against major currencies in early trading. Investors are preparing for a slew of Chinese data that will give a reading on the health of the economy as political leaders gather in Beijing for a four-day meeting.
The S&P 500 climbed 0.5% on Friday as Trump said the much higher tariffs he had threatened to impose on Chinese imports wouldn’t be sustainable, as regional bank shares stabilized after Thursday’s rout. Chinese officials told their global counterparts that tightened export controls will not harm normal trade flows, as Treasury Secretary Scott Bessent and Vice Premier He Lifeng prepare to meet for talks.
“Hopes are high that US Treasury Secretary Bessent and his Chinese counterpart He Lifeng will resolve some trade issues this week,” Commonwealth Bank of Australia strategists including Joseph Capurso wrote in a note to clients. “An announcement that presidents Trump and Xi will meet this month will be a signal that tensions are cooling, supporting risk appetite.”
Traders will first need to navigate China’s monthly data dump Monday that may show growth slowed in the third quarter, according to a Bloomberg survey. Commercial banks are also expected to keep their 1—year and 5-year loan prime rates steady, the survey shows.
Chinese political leaders will also begin gathering in Beijing a four-day meeting, known as its Fourth Plenum, with traders watching for fresh measures to extend China’s strongest equity rally in eight years and shore up the yuan. While a detailed plan will only be released March next year, investors will scrutinize the post-meeting readout for any policy signals ahead of the possible meeting between Xi and Trump.
Oil edged higher despite signs of a glut with more than 1 billion barrels amassed on the world’s tanker fleet. Gold climbed after losses on Friday.
“Gold can sustain its positive premium even as the US-China trade spat and regional US bank worries fade,” Barclays strategists including Lefteris Farmakis wrote in a note to clients.
French bond futures will also be closely watched after S&P Global Ratings late Friday downgraded France to A+ from AA-, saying the country’s budget uncertainty was “elevated”. France has now lost its double-A rating at two of the three major credit assessors in little more than a month, potentially forcing some funds with ultra-strict investment criteria to sell the country’s bonds.
