Mixed leads overseas: Australian shares to open lower

Market Reports

by David Chau

Australian shares are set for a lower open this morning, following weak leads from US equities.  Most S&P 500 sectors finished in the red – with financials, utilities and energy leading the losses.

On Monday, FBI Director James Comey testified in front of Congress – confirming that the Trump campaign, during last year’s election, is being investigated for possible links with Russia. Mr Comey also said the FBI has “no evidence” that former President Barack Obama “wire-tapped” Trump Tower last year.

Meanwhile, the British Pound has fallen against the Aussie dollar.  On Monday, British Prime Minister Theresa May announced she will trigger Article 50 on 29 March (in eight days time), and begin divorce proceedings to take the UK out of the European Union.

Local economic news

Today, the ABS will release December figures for house prices across Australia’s eight capital cities – so look out for that later today.

Markets

Wall Street finished mixed: The Dow Jones Industrial Average was flat at 20,906, the S&P 500 fell 0.2 per cent to 2,373 and the NASDAQ was flat at 5,902.

European markets finished mixed as well: London’s FTSE rose by a slight 0.1%, while Paris and Frankfurt both fell 0.35%.

Asian markets closed higher: Tokyo’s Nikkei was closed, Hong Kong’s Hang Seng rose 0.8 per cent, while China’s Shanghai Composite advanced 0.4 per cent.

The Australian share market finished lower yesterday: the S&P/ASX 200 index fell 21 points to close at 5,779. On the futures market the SPI is 10 points lower.

Company news

The ACCC has granted its interim approval for Virgin Australia Holdings’ (ASX:VAH) proposed alliance with HNA Aviation, Hong Kong Airlines and HK Express. Once this deal proceeds, Virgin will introduce new direct services between Australia and Hong Kong, as well as between Australia and China. The airlines will also agree to codeshare and introduce a reciprocal frequent flyer partnership between Virgin Frequent Flyer and Fortune Wings Club. The ACCC is expected to announce its final ruling in May or June. Yesterday, shares in Virgin Australia closed 2.56% lower at 19 cents.

Ex-dividends

Three companies are going ex-dividend today:

Kip McGrath Education Centres (ASX:KME) will pay 0.6 cents, unfranked.
Probiotec (ASX:PBP) will pay 0.5 cents, fully franked.
Webjet (ASX:WEB) will pay 7.5 cents, fully franked.

Currencies

The Australian Dollar at 7.30am was buying 77.34 US cents, 62.6 Pence Sterling, 87.01 Yen and 72 Euro cents.

Commodities

Gold has risen $3.90 to $US1,234 an ounce.
Silver has gained 3 cents to $17.44 an ounce.
Oil has fallen 42 cents to $US48.89 a barrel.