Monetary Policy Meeting Minutes Released Today

US:

Trading in the US was quiet overnight as a result of Columbus Day. The major indices each closed slightly down with the largest fall coming from the S&P 500 with a 0.14% drop. In terms of sectors, Materials was the worst with a 0.71% fall while Real Estate was the best with a 0.15% gain. Tomorrow morning (US time) several large companies including Goldman Sachs (GS) and Johnson & Johnson (JNJ) will report earnings.

ASX:

ASX 200 futures are currently pointing to a lower open, being down 32 points. Yesterday, the ASX 200 opened over 0.8% higher but drifted lower throughout the day. Nevertheless, the index closed up 0.54% which extended the gains made on Friday. Today the Reserve Bank releases the minutes of the most recent policy meeting at which the board decided to lower interest rates by 25 basis points. The minutes will be analysed to determine whether more rate cuts are on the cards.

Commodities and Currencies:

Gold prices held steady while oil prices declined overnight on renewed demand concerns. Supply is currently under pressure from declining production in Venezuela, the outage in Saudi Arabia and sanctions on Iran but traders are concerned that weakness in demand will more than make up for these supply issues. The British pound sold off overnight on pessimism that Brexit talks will reach an agreement in time for the October 31 deadline.

The spot price of gold is currently up 0.2% at US$1,492 per ounce.

The AUD is currently down 0.5% at US$0.677.

This article was written by William O'Loughlin – Portfolio Manager, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3633.