How’dy USA

In US economic data, retail sales rose 0.4% in August (forecast +0.2%). Excluding autos, sales were flat (forecast +0.1%). Export prices fell 0.6% in August (forecast -0.2%) and import prices fell 0.5% (forecast -0.4%). Consumer sentiment rose from 89.8 to 92.0 in September (forecast 90.9).

US share markets were mixed on Friday. Materials rose 1.1% but real estate fell 1.3%. Shares in Apple lost 1.9% after a major broker cut its price target on the stock. The Dow Jones rose by 37 points or 0.1% after trading in an 84 point range. The S&P500 index fell 0.1%; the Nasdaq lost 18 points or 0.2%. Over the week the Dow rose 1.6%, the S&P 500 rose 0.95% and the Nasdaq gained 0.9%.

US treasuries were weaker again on Friday (yields higher). Investors perceived an easing of US-China trade tensions. And retail sales rose by more than expected in August. US 2-year yields rose by 8 points to 1.802% and US 10-year yields rose by 11 points to 1.899 per cent. Over the week, US 2-year yields rose by 27 points and US 10-year yields rose by 35 points. It was the largest weekly gain for 10-year yields in 6 years and the biggest weekly gain in 2- year yields in a decade.

Bonjour Europe

European share markets posted moderate gains on Friday. The US and China made trade concessions to each other. Banks rose by 3%, miners rose 2.7%, autos rose 1.3% but the defensive food and beverages sector fell 2.1%. The pan-European STOXX600 index rose by 0.3%, the German Dax lifted 0.5% and UK FTSE gained 0.3%. In London trade, shares of Rio Tinto rose by 2.2% and BHP lifted by 1.8%.

Hello World!

Major currencies held in tight ranges against the US dollar in US and European trade compared with the end of Asian trade. The Euro held between US$1.1060 and US$1.1110 and was around US$1.1070 in late US trade. The Aussie dollar held between US68.65 cents and US68.90c and was near US68.75c in late US trade. The Japanese yen broadly held between 107.90 yen per US dollar and JPY108.15 and was near JPY108.05 in late US trade.

Global oil prices fell by around 0.4% on Friday. Concerns about the softness of global economic growth balanced optimism on US-China trade talks. The Brent crude price fell by US16 cents or 0.3% to US$60.22 a barrel. And the US Nymex price fell by US24 cents or 0.4% to US$54.85 a barrel. Over the week Brent fell by 2.1% and Nymex fell by 3.0%.

Base metal prices were generally firmer on the London Metal Exchange on Friday. Copper rose 2.5% but tin lost 3.9% and nickel lost 1.9%. Over the week metals rose up to 2.4% with copper doing best and zinc rose 2.2%. But tin lost 5.4%.

The gold futures price fell by US$7.90 or 0.5% to US$1,499.50 an ounce. The spot gold price was trading near US$1,488 an ounce in late US trade. Over the week gold fell by US$16 an ounce or 1.1%. Iron ore rose by US25 cents or 0.3% to US$99.10 a tonne. Over the week iron ore rose by US$11 a tonne or 12.5%.

Iran-backed Houthi rebels in Yemen have claimed responsibility for a drone attack on Saudi Arabia's Abqaiq plant. About half of the country's oil output has been affected.

G’day Australia

In Australia, no major data is expected. In China, retail sales, production and investment data is issued. In the US the Empire State manufacturing index is released.