ASX Set to Open Lower Despite Positive US Market Signals

Local stocks in Australia are expected to have a weak start as the trading day begins, despite a mostly positive performance from the US market. Notably, the Dow Jones Industrial Average has closed at a record high, while the S&P 500 managed to finish nearly flat.

Market analysts are awaiting economic data to be released from China at 1pm AEDT. This data includes crucial third quarter growth figures, as well as updates on industrial production, retail sales, fixed asset investment, and unemployment rates.

While these figures are important, many experts believe it is too soon to see the effects of the recent stimulus measures implemented by the Chinese government. CBA economist Kristina Clifton highlights that the anticipated growth in China's GDP for the third quarter is expected to be around 1.0% quarterly, which is considered weak by China's standards due to sluggish consumer spending and struggles within the property sector.

Market Overview

As of this morning, ASX 200 futures indicated a decline of 0.3%, sitting at 8,364 points. The Australian dollar is trading flat at 66.95 US cents. The US market presented mixed results yesterday, with the S&P 500 losing a modest 0.02% to close at 5,842 points, while the Nasdaq gained a slight 0.04% to reach 18,373 points. In international markets, the FTSE 100 and EuroStoxx 600 both rose by 0.7% and 0.8%, respectively.

China's Economic Data

Today, China will release a series of economic indicators that will provide insights into the country's growth and economic health:

• Third quarter GDP
• September industrial production
• September retail sales
• September fixed asset investment
• September unemployment rate

Following a recent announcement about additional stimulus measures aimed at supporting the property sector, experts have noted that while these strategies may support long-term recovery, they are unlikely to significantly impact immediate steel and iron demand.

Market Reactions to Stimulus Measures

The influence of these stimulus measures was already visible yesterday, as iron ore futures experienced a drop following the news that the Chinese government is expanding its support for the completion of unfinished housing projects significantly. As a result, it is expected that the ongoing reliance on these measures might lead to growing disappointment among investors in the commodity markets.

In summary, ASX is set for a softer opening as traders react to the mixed signals from overall market trends, while all eyes are on China's forthcoming economic updates.

Market, Economy, Stocks