Post-US election rally falters: flat opening for ASX

Market Reports

by David Chau

The Australian share market is headed for for a flat opening, following weak leads overseas.

In the last few weeks, global equities experienced a strong post-US election rally, reaching new record highs.  However, the rally slowed down overnight, with Wall Street finishing lower due to weak performances from energy, financials and healthcare stocks.

Also, investors are keeping a close watch on very volatile oil prices – waiting to see whether this Wednesday’s OPEC meeting will result in a decision to freeze oil output.

Overnight, the Australian Dollar increased slightly against the US Greenback, and the iron ore spot price surged to over $US80 per tonne, rising by over 25% this month.

Markets

Wall Street finished lower overnight: The Dow Jones slipped 0.3% to close at 19,098, the S&P 500 is down 0.5% at 2,202, while the NASDAQ lost 0.6% to close at 5,369.

European markets finished lower as well: London’s FTSE was down 0.6%, Paris lost 0.9%, and Frankfurt slipped 1.1%.

Asian markets were mixed: the Nikkei was down 0.1%, while both the Hang Seng and Shanghai Composite gained 0.5%.

The Australian share market had a weak finish yesterday: The ASX 200 closed 43 points down at 5,464. This morning, on the futures market the SPI is down 5 points.

Currencies

The Australian Dollar at 8.20am is buying $US0.7477, 60.24 Pence, 83.79 Yen and 70.48 Euro cents.

Company news

A beer brewing company, called Broo Ltd (ASX:BEE), which recently listed on the ASX, has signed a distribution deal in China, one of the largest beer markets in the world. The company says that the Jinxing Beer Group Co Ltd has added Broo Premium Lager to its national product portfolio list. Jinxing is a large beer producer in China, and Broo (at this stage) will be its only international label on offer. Yesterday, Broo’s share price rose strongly by 19.4% to finish at 40 cents.

Centuria Capital Ltd (ASX:CNI), has exchanged contracts to acquire a property called Scarborough House, in Canberra, for $72.3 million. This property is 98% leased to the Department of Health, and was purchased from the Indigenous Real Estate Investment Trust. The property will be owned by a new unlisted property fund called the Centuria Scarborough House Fund, which is expected to launch to investors in February 2017. This transaction is expected to settle in mid-April 2017. Shares in Centuria closed 3.72% lower at $1.03.

Ex-dividends

Three companies are going ex-dividend today.  They are: the Aurora Dividend Income Trust, Ding Sheng Xin Finance Co Ltd, and GrainCorp Limited.

Commodities

Gold is up $0.90 at $US1,192 an ounce.
Silver is flat at $16.58.
Copper is flat at $2.65 a pound.
Oil is down $0.22 to $US46.86 per barrel.