Impact of a possible hung parliament in Australian markets

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Both the US and the UK reported positive manufacturing numbers over the weekend. The UK Manufacturing PMI rose to 52.1 while in the US registered 53.2 – both numbers came out better than what analysts were expecting.

Locally, the Australian Federal election on the weekend delivered some shock to the Liberal party as the results showed Independent parties/candidates won votes away from the major parties.

“We could be facing a hung parliament as the results indicate a level of disillusionment for the major parties,” said Joseph Jeffriess, currency strategist at GO Markets.

View the full market commentary on video here.

“We are still waiting for the final results, we are not there yet, so it will be interesting to see the final tally for the major seats.”

In the meantime, the US markets scored another strong performance on the weekend. US markets were up for the fourth day in a row last Friday.

Back home, building permits data will be out this morning and the Reserve Bank of Australia (RBA) will have another rate decision tomorrow.

Some observers are saying the RBA will hold on to the current rates, but there seems to be a lot of pressure for a rate cut.

In commodities, gold was also up over the weekend and was trading around the $1341 level.

Oil was also stronger and could be looking to test the $50 per barrel level.

The markets will also be eyeing the Japanese Yen and the JPN 225 index today as the Yen had a strong performance late last week.

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GO Markets was founded in 2006 in Melbourne, Australia and is one of Australia’s premier MT4 Forex Brokers, offering Forex and CFD trading as well as Binary Options trading, via MT4, to individuals and institutional clients.

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