The Australian share market is set to open flat this morning, and have a subdued trading day. This afternoon, the Reserve Bank will makes its interest rate decision, and it’s expected to maintain the official cash rate at the record low 1.5%.
US equities are also providing a weak lead for the local share market. This morning, Wall Street finished lower, hampered by the performance of financials and materials stocks. Also weighing on the mind of investors is the increased likelihood of the US Federal Reserve raising interest rates next month. Currently, the likelihood of a US rate hike is 85%.
In addition, geopolitical tensions have flared up these last few days – with North Korea launching four ballistic missiles, three of which landed in Japan’s exclusive economic zone, and over the weekend, US President Donald Trump made unsubstantiated allegations over Twitter that his predecessor, Barack Obama, wiretapped Trump Tower during last year’s election.
Also this morning, Trump signed a revised executive order banning citizens from six predominantly Muslim countries from travelling to the US. Trump’s first attempt at the ban was blocked by the US courts last month, and it’s expected the revised executive order will trigger further court cases testing its legality.
US economic newsAccording to the Census Bureau, US factory orders rose by a higher-than-expected 1.2% in January -- the second increase in two straight months. Compared to one year ago, factory orders were up 5.5%. This positive data suggests that the manufacturing sector is gaining momentum, with higher commodity prices boosting demand for machinery.
MarketsWall Street finished lower this morning: The Dow Jones Industrial Average fell 0.24 per cent to close at 20,954, the S&P 500 was down 0.3 per cent to close at 2,375 and the NASDAQ retreated 0.4 per cent to close at 5,849.
European markets closed lower as well: London’s FTSE lost 0.3 per cent, Paris fell almost 0.5 per cent and Frankfurt was down 0.6 per cent.
Asian markets closed mixed: Tokyo’s Nikkei fell 0.5 per cent, Hong Kong’s Hang Seng added 0.2 per cent, and China’s Shanghai Composite gained 0.5 per cent.
The Australian share market finished higher yesterday: the S&P/ASX 200 index gained 17 points to close at 5,747. On the futures market the SPI is 8 points lower.
Company newsMining company, Austral Gold
(ASX:AGD) has paid US$1 million to Troy Resources
(ASX:TRY) to acquire an additional 19% stake in the Casposo silver-gold mine in San Juan, Argentina. This now raises Austral’s total stake in the Argentinean mine to 70%. Last year, Austral recommissioned the mine and, in November, it began full operations. So far, Austral has spent US$5.8 million in developing Casposo and recommissioning operations. Yesterday, shares in Austral Gold closed 6.06% higher at 17.5 cents.
CurrenciesThe Australian Dollar at 8.30am was buying 75.83 US cents, 61.98 Pence Sterling, 86.36 Yen and 71.67 Euro cents.
CommoditiesGold has slipped by $0.50 to $US1,226 an ounce.
Silver has gained 7 cents to $17.80.
Oil has dropped 14 cents to $US53.19 a barrel.
Ex-dividends
