THE QUOTE: Many traders are on vacation and “we’re mostly finished with earnings season and we don’t have a lot of economic news”, said Joseph Tanious, senior investment strategist at Bessemer Trust.
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“However, whilst Yellen’s speech without doubt is being closely watched and has potential to move markets substantially, the next set of US non-farm payroll data due in a week is by many being considered as even more important as a very strong reading could pretty much seal a rate hike in September”.
In the currency market, the Australian dollar is slightly lower against the USA dollar on Friday as traders await Yellen’s speech later in the day. The broader All Ordinaries Index is down 5.20 points or 0.09 percent to 5,626.20.
But Welspun India Ltd fell 3.5 percent, extending declines for a fifth straight session as the fallout from Target Corp’s decision to terminate business with the firm for passing off cheap sheets as premium Egyptian cotton escalated.
The benchmark S&P/ASX 200 Index is losing 7.00 points or 0.13 percent to 5,534.90, off a low of 5,513.70 earlier. The stock had gained 12.8 percent this week as of Thursday’s close.
The Japanese market is declining. Palladium was 1.6 percent higher at $695.10. Fast Retailing is edging up 0.06 percent, while SoftBank is declining 0.6 percent. In the oil sector, Inpex is down 1.5 percent and JX Holdings is losing 1 percent.
Foreign funds have bought a net $5.8 billion of local shares this year, the most in Asia after Taiwan and South Korea, as capital flows to emerging markets accelerated amid a wave of global policy easing.
Meanwhile, synthetic fiber maker Toyobo Co.is losing more than 4 percent, Terumo Corp.is down nearly 4 percent and Chughai Pharma is lower by more than 3 percent. Core CPI, which excludes volatile food costs, slid 0.5 percent on year – missing forecasts for -0.4 percent, which would have been unchanged.
“Dudley’s hawkish comments have come as a surprise and if Yellen says the USA data has been good enough to continue tightening policy, then we could see dollar/yen rally towards the 102 yen mark”, said Richard Falkenhall, currency strategist at SEB.
Stocks fell in light trading for a second day on Thursday as investors sifted through a mix of earnings reports. If you saw these sorts of figures replicated throughout the third quarter that would be very positive for GDP and could help remove the major drag that we saw from inventories in 2Q, which could provide the basis for a December rate hike. France’s CAC-40 lost 0.7 and Britain’s FTSE 100 fell 0.3 percent. Hong Kong’ Hang Seng index rose 0.6 percent to 22,963.33.
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Crude oil futures rose on Thursday amid geopolitical tensions and on speculation that the USA dollar will fall following Yellen’s speech on Friday.
