Global markets were generally lower on Friday, while local currencies moved higher as the US Dollar continued to slide. Both the Australian Dollar and NZ Dollar have surged to recent highs of 79 cents and 74 cents versus the US dollar respectively. The moves have come rapidly, and we would not be surprised to see a currency correction lower.
The moves appear to be driven by US Dollar weakness. The US dollar index has fallen to its lowest level in almost a year amid ongoing concerns that the Trump administration will struggle to enact policies the market had hoped would stimulate the US economy. Further, US Federal Reserve Chair Janet Yellen’s recent public comments have been slightly dovish.
While a weaker currency level for the AUD & NZD is one of ’s key medium term investment themes, currency moves must also be kept in mind when investing offshore.
For investors who wish to invest offshore, is pleased to announce the launch of US Stock coverage.
Launches US Stock Coverage
We have initiated coverage of selected US stocks such as Tesla, Amazon, Nike, and Johnson & Johnson. Many of the stocks covered are what we believe to be market leaders in terms of new technology and innovation.
One of the stocks we have placed a buy rating on is Netflix (NFLX.NASDAQ) which recently reported another set of impressive quarterly results.
Looking at some of the details, revenue was up +32% compared to the same time last year, and NFLX added a huge 5.2 million subscribers, which smashed forecasts for 3.2 million net subscriber additions for the quarter. Overall it was a very strong result which resulted in a jump in NFLX’s share price.
Australia & New Zealand Market Movers
The Australian share market lost ground on Friday (ASX 200 index -0.67%) as solid jobs data failed to extend early gains on the ASX, but the Australian dollar reversed from 2-year high. In other news, Telco Optus is investing $1 billion to build an alternative mobile offering in regional Australia in a bid to break Telstra's "stranglehold" on coverage away from big cities.
The New Zealand market was little changed on Friday (NZX 50 index -0.02%) with Fletcher Building continuing yesterday's selling while New Zealand Refining was the best performer, making gains since its throughput and margin report for May and June was released last Tuesday. As mentioned above the New Zealand dollar rose above 74 US cents for the first time in 10 months.
3 Things Markets Will be Watching this Week
1. US Corporate Earnings season will be centre stage with major Tech stocks such as Amazon & Facebook set to report
2. The US Federal Reserve makes an interest rate decision Thursday morning (AU/NZ time)
3. OPEC oil producing nations are set to meet in Vienna this week
Have a Great Day,
Team
