Signs show construction industry is still in decline

Share Markets:

Markets adopted a risk adverse attitude overnight as concerns over the pace of global growth intensified.

Negative comments in the Fed minutes were built upon by IMF Director Christine Lagarde, who intimated that the IMF global growth forecasts would likely be revised lower in the months ahead.

Weaker oil prices dragged energy stocks lower and the banking sector was also particularly weak. In the US, the Dow fell 1.0% and the S&P500 was down 1.2%.

In Europe, the FTSE fell 0.4% and the German Dax was down 1.0%.

Interest Rates: 

US bond yields fell as investors backed away from the share market and bid up the price of bonds.

Ten-year US government bond yields fell 7 basis points to 1.69% while 2 year yields were down 4 basis points to 0.69%.

Bond yields were also weaker in Germany and the UK overnight. In Australia yesterday, yields were generally steady but some downward pressure seems likely in today's trade.

Foreign Exchange:

The US dollar index bounced off a six-month low in early London trade and firmed marginally overnight. EUR was weaker while the yen continued to outperform.

The AUD was weaker as commodity prices slid on the back of global growth concerns. At its low, the AUD fell back into the US74 cent range but moved back into the US75 cent range later in the session.


Oil and copper retreated while the price of gold rose. Copper fell 2.9% on global growth concerns while oil weakened on the belief that US supplies are unlikely to drop in the near term.

The pick-up in gold reflected general nervousness with other asset classes. The price of iron ore was steady in the $US54 per tonne range.


The AiG performance of construction index slipped further intro contraction territory in March to 45.2 from 46.1 previously.

The index has been below 50, marking contraction, for four consecutive months. Activity weakened across the engineering and home building sectors.

It was steady in the commercial sector and expanded marginally in the apartment construction sector.


No major data released.


The ECB minutes revealed broad support for the stimulus package announced at the 10 March meeting, with only minor objections to negative rates and asset purchases.

United States: 

No major data released.

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