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Friday’s sell off saw Australian shares close 2% lower. It was the 4th straight week of declines. Banking stocks were the worst performers. All four major banks tumbled, with Commonwealth Bank (ASX:CBA) down the most. Mining stocks also fell, while travel stocks were higher after Prime Minister Scott Morrison announced international borders will open in November.

European stocks closed in the red on Friday after economic data released showed euro zone inflation hit a 13-year high. Inflation rose 3.4% in September, the highest reading since September 2008. The Stoxx 600 closed 0.4% lower.

There was a broad rebound in New York. All three major benchmarks advanced, following a surge in US consumer spending data for August. The Dow gained 480 points, the S&P 500 rose nearly 1.2% and the Nasdaq gained 0.8%. The 10-year Treasury yield fell on Friday, back below 1.5%.

Following US equities, the SPI futures are suggesting the ASX200 will open 0.7% higher.

What to watch today,

• Take note that October is historically another volatile month.
• BSA Limited (ASX:BSA) goes ex-dividend today.
• Some of the most traded stocks on Friday by Bell Direct clients were Fortescue Metals (ASX:FMG) and Mineral Resources (ASX:MIN), as mining stocks all dropped. FMG fell 2.6% on Friday and was one of the ASX200’s worst performers in September, falling over 20% the past month, with the drop in iron ore prices. FMG is a Bell Potter BUY. MIN fell 6.9% on Friday, that is a Citi BUY.
• In economic news, housing data released on Friday saw property prices are still rising, up 1.5% in September and have jumped 20% over the year. Economic updates in the week ahead will include Balance of Trade data for August and the RBA’s interest rate decision released tomorrow and Building Permits out on Friday.
• The oil price has lifted 1.1% and is trading above US$75, supported by tight supply and high demand ahead of OPEC’s meeting next week.
• Gold is trading higher, with a strong dollar, rising bond yields, as well as expectations that the US Fed will pull back on bond-buying in November.
• The coal price continues to rise, amid the tight supply in China, while the seaborne iron ore price is trading 3.6% lower at US$115 per tonne.

Trading Ideas:

• Bell Potter have upgraded Uniti Group (ASX:UWL) from a HOLD to a BUY. Their 12-month price target remains unchanged at $4.50, where the total expected return is over 15%. Bell Potter views the recent pull back in UWL’s share price as a buying opportunity and forecast continued strong growth. UWL closed lower on Friday at $3.82, implying 17.8% share price growth in a year.
• Bullish charting signals have been identified in Imdex (ASX:IMD), Cynata Therapeutics (ASX:CYP) and Elsight (ASX:ELS) according to Trading Central.