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As spring approaches and reporting season comes to an end, what will drive our markets higher?

Good Morning,

 

The days are certainly getting longer and spring is on its way….

 

Another busy day ahead for us with the likes of Blackmores, Caltex, Healthscope, Oil Search and Amcorreporting their FY results.

 

Who will miss and who will report “positive earnings with a strong outlook?”

 

In yesterday’s trading session, it was GWA, DWS Limited and BlueScope that reported strong underlying earnings, while APN Outdoor Group, MIG and Macquarie Media disappointed….

 

In the US, stocks were mixed (Dow Jones -23 points), as crude oil fell ~ 3%, while a lack of catalysts in the market failed to inspire …..

 

Once the AUS reporting season is over, the market will once again turn its attention to whether “US interest rates will rise” anytime soon….

Global markets have been “whipsawed” by comments from regional Fed presidents including William Dudley and John Williams that indicated U.S. borrowing costs may rise as early as next month.

Their remarks set the stage for Chair Janet Yellen, who speaks Friday at an annual symposium hosted by the Kansas City Fed in Jackson Hole, Wyoming.

Futures prices indicate about a 52 percent chance the central bank will increase rates this year, up from a 45 percent probability a week ago, according to data compiled by Bloomberg.

A stronger dollar will bode negatively for commodities such as Gold, Silver and Iron Ore.

“There is also the risk of financial instability down the road” because of extraordinary monetary policy, El-Erian, Allianz’s chief economic adviser, said Monday in an interview on Bloomberg Radio. “And that, I think, is the strongest argument for trying to slowly normalize rates, because otherwise you contribute to excessive risk taking.

The SPI is down 8 points this morning

 

Niv Dagan is an Executive Director of Melbourne based boutique funds management and corporate advisory firm, Peak Asset Management (www.peakassetmanagement.com.au). He is also a regular financial commentator on Sky Business

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