Outlook: Flat Wednesday opening for Aus shares

Market Reports

by David Chau

The Australian share market looks set to open flat today, following a mixed performance from Wall Street overnight as its rally over the last month begins to falter.  Half the major S&P sectors finished lower, with Utilities and Telecoms being the worst performers.

As for US company highlights, Apple sold more iPhones than expected in the latest quarter, which sent their shares up by almost 7 percent.

Twitter shares finished lower as it has been struggling with slow user growth, compared to Facebook and other social media competitors.

The stock which weighed most heavily on the Dow Jones was fast food giant, McDonald’s, as it reported quarterly sales that were lower than expected.

Meanwhile, the Federal Reserve has begun its two-day meeting to discuss interest rates. Investors are not expecting rates to rise tomorrow, but they will look for clues about when the next interest rate hike will happen.

US economic news

New home sales increased by 3.5% in June to a seasonally adjusted rate of 592,000. As for median house prices, they were $306,700 in June (which is an increase from $288,800 in May).  Compared to one year ago, US homes are now 6% more expensive.

Markets

Wall Street closed mixed overnight: The Dow Jones Industrial Average lost 0.1 per cent to close at 18,474, the S&P 500 is up 0.03 per cent to close at 2,169 and the NASDAQ is up 0.24 per cent to close at 5,110.

European markets finished higher: London’s FTSE was up 0.2 percent, Paris was up 0.2 per cent and Frankfurt was up 0.5 per cent.

Asian markets closed mixed: Nikkei was down 1.4 percent, the Hang Seng gained 0.6 per cent, and the Shanghai Composite was up 1.1 per cent.

The Australian share market closed higher yesterday: The ASX 200 closed 4 points higher to finish at 5,537. On the futures market the SPI is up 12 points.

Currencies

The Australian Dollar at 7:30AM was buying $US75.06 cents, 57.16 Pence, 78.56 Yen and 68.32 Euro cents.

Australian economic news

Later today, the ABS will release its latest Consumer Price Index data.

Company news

Software company, Prophecy International Holdings Ltd (ASX:PRO) is expecting ‘record results’ for the 2016 FY. The company says its full year revenue should be $14.7 million (after its accounts have been audited) – which is a 47% increase compared to the previous financial year.

Shares in Prophecy closed 2.61% lower at $1.12.

Retail property group, Vicinity Centres (ASX:VCX) says its retail property portfolio has been revalued upwards by $279 million, as at 30 June – which is a 2% net valuation gain. Though, the company says this is subject to a final audit and its annual results for the 2016 FY will be released on 17 August.

Shares in Vicinity Centres closed 0.28% higher at $3.53.

Commodities

Gold has gained $1.10 to $US1,328 an ounce for the August contract on Comex.
Silver has gained $0.04 to $19.68 for September.
Copper is up 1 cent at $2.23 cents a pound for September.
Oil is down 21 cents to $US42.92 per barrel for September light crude in New York.

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