US tech stocks fall, banks gain: Aus shares to open flat

Market Reports

by Jessica Amir

Wall Street has seen a rise in bank stocks, while big tech plays like Facebook, Amazon and Alphabet have closed lower, which will see our the Australian share market lack direction at the open.

The SPI futures is tipping a low single digit gain, after the S&P500 closed virtually flat, gaining 0.77 points with Utilites and Tech stocks underperforming.

The Dow Jones also closed in positive territory, gaining almost 15 points with heavyweight Goldman Sachs leading the charge, while the tech heavy Nasdaq closed 18 points lower.

The lack of steam out of the US came as investors digested weaker than expected economic news. But traders were also eyeing what came out of Washington, as President Donald Trump was set to discuss immigration with the Indian Prime Minsiter Narendra Modi, who he was meeting for the first time.

Meantime, gold hit a six-week low, on the back of a massive sell order. A trader said it was mistake sale, as the seller quickly bought it back.

US economic news

Overall durable goods orders which are for items ranging for from toasters to aircraft, meant to last three years or longer, fell 1.1 per cent in May, far greater than the 0.6 fall expected. It follows the drop of 0.9 per cent in April.

The Commerce Department also reported new orders for key capital goods fell unexpectedly further than initially thought. Non-defense capital goods, excluding aircraft (which is a closely eyed indicator for business spending) dropped 0.2 per cent. That’s the largest drop since December. The fall follows a revised rise of 0.2 per cent in April.

Local economic news

The wait for the Census 2016 data is over. Today is the day we’ll see the first release of Australia’s largest statistical collection from the Australian Bureau of Statistics (ABS) in five years. Regardless of the online debacle that surrounded the data collection last year, earning the hash tag #censusfail, all economic eyes will be on demand for homes, as housing conditions seem to be mixed.

The ABS will also release the demographic December quarter population statistics. The New South Wales, Victorian and ACT economies are the leading the way, because of population growth. 

Markets 

Wall Street closed mixed on Monday: The Dow Jones Industrial Average gained 0.1 per cent to close at 21,410, the S&P 500 added 0.03 per cent to close at 2,439 and the NASDAQ sank 0.3 per cent to close at 6,247.

European markets closed higher: London’s FTSE rose 0.3 per cent, Paris added 0.6 per cent and Frankfurt advanced 0.3 per cent.

Asian markets also closed higher: Tokyo’s Nikkei gained 0.1 per cent, Hong Kong’s Hang Seng added 0.8 per cent, and China’s Shanghai Composite rose 0.9 per cent.

And back home, the Australian share market closed higher on Monday: At the closing bell, The S&P/ASX 200 Index closed 4 points higher to finish at 5,720. On the futures market the SPI is 2 points up.

Company news

CuDeco Limited (ASX:CDU) has entered into two short term loan facility agreements to fund $15 million of its China Minsheng Bank repayments.The copper miner and producer’s agreement are for HKD 80 million (about $US10.2 million) and US$4.8 million. The loan proceeds will be applied as a full repayment to China Minsheng Bank (which is due on 30 June 2017). While CuDeco intends to pay the loans by the due dates (21 July 2017 and 10 July 2017) it is currently negotiating longer term financing with the parties. Shares in CuDeco Limited (ASX:CDU) last traded flat at 25 cents.

To ex-dividends,

Four companies are going ex-dividend today

Aspen Group (ASX:APZ) is paying 2.5 cents unfranked
Centuria Metro REIT (ASX:CMA) is paying 4.38 cents unfranked
Centuria Capital (ASX:CNI) is paying 5.2 cents unfranked and
Centuria Urban REIT (ASX:CUA) is paying 3.75 cents unfranked.

Currencies

The Australian Dollar at 7:30AM was buying 75.86 US cents, 59.68 Pence Sterling, 84.85 Yen and 67.85 Euro cents.

Commodities

Gold has tumbled by $11.10 to $US1,245 an ounce.
Silver has lost 8 cents to $US16.63 an ounce.
And Oil has gained 48 cents to $US43.49 a barrel.