City dwelling prices still on the up and up

Australia:  

Australia-wide capital city dwelling prices grew for the seventh consecutive month, lifting 0.8% in July according to CoreLogic. 

Over the year to July, dwelling prices continued to rise but not at the pace seen in earlier months. Growth in the year to July was 6.1%, the weakest since October 2013.

In good news for the manufacturing sector, the AiG Performance of Manufacturing Index rose from 51.8 in June to 56.4 in July. 

This continues a recovery in the manufacturing sector that has now been running for thirteen months, marking the longest growth phase for the sector in well over a decade. According to AiG, the weaker AUD has assisted exports and import replacement.

New home sales increased by 8.2% in June 2016, following declines of 4.4% in May and 4.7% in April. Over the June quarter, the number of new home sales fell 1.3% to be down 2.9% on the same quarter last year.

Share Markets: 

The Dow and the S&P500 edged lower on a combination of weaker oil prices and renewed concern regarding US rate hikes.

The Dow fell 0.2% and the S&P500 was down 0.1%.

The Nasdaq rose 0.4% to stand at its highest level since July 2015 as the earnings of Apple and Google parent Alphabet beat market expectations for both profit and revenue.

The Hong Kong market faces the possibility of not trading today or opening late due to the approach of tropical cyclone Nida.

Interest Rates:

According to US FOMC member William Dudley, investors are underestimating how many times the Fed will lift rates this year and next.

His speech last night contributed towards weaker equity markets and a 7 basis point rise in 10 year US government bond yields.

Long bond yields were firmer in Japan and the UK overnight but markets were subdued in Australia with many participants away for a bank holiday.

Foreign Exchange: 

The US dollar index posted a very modest gain overnight, halting its slide of the past few days. Firmer yields in the US assisted the USD and saw the AUD move lower into the US 75 cent range. The AUD was weaker across the board possibly in advance of today's RBA board meeting.

Commodities:

Oil fell 3.6% on concerns that global supply will continue to expand. Copper was weaker on modest manufacturing numbers out of the US and China while gold was steady. Iron ore pushed higher and now stands at $US62.27 per tonne.

China:

The Caixin manufacturing PMI jumped from 48.6 in June to 50.6 in July. It was the first time since February 2015 that the index has sat above 50. 

However, the official index of Chinese manufacturing activity fell from 50.0 to 49.9 over the same period. The official measure of services activity picked up from 53.7 in June to 53.9 in July.

Europe:

The Markit Eurozone Manufacturing PMI edged higher to 52.0 in July from 51.9 in June.

Japan: 

The Nikkei Japan Manufacturing PMI rose from 49.0 in June to 49.3 in July.  In the year to July, vehicle sales in Japan fell 0.2%.

United Kingdom: 

The Markit Manufacturing PMI fell to 48.2 in July from 49.1 in June.

United States:

The ISM measure of US manufacturing fell from 53.2 in June to 52.6 in July.

Despite this, new orders remain firm at 56.9. Construction spending in the US fell 0.6% in June following a 0.1% decline in the previous month.


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