Wall Street takes profits: Aus shares to slide at open

Market Reports

by Jessica Amir

The Australian share market is set for face some hurdles at the open with the SPI futures tipping a fall of over 60 points. It comes as US markets closed in the red after the tech space fell 1.8 per cent, dragging down the broader market. European markets also closed lower.

It’s important to remember, in the US, it’s the next-to-last trading day of the quarter, which is usually a time when investors reposition their portfolios or take profits.

Shares in Apple, Facebook, Google-parent Alphabet, Amazon and Netflix all dropped over 1 per cent. It is also important to note that tech sector has been the stand out performer for most of 2017, but over the past month it has dropped nearly 2 per cent.

Back to the indicies, the Dow fell 168 points with Apple, Boeing and 3M adding the most losses, while the S&P 500 traded below its 50-day moving average for the first time since 18 May 2017.

Meantime, financials were the only sector bucking the trend in the US and traded higher, while the Energy space closed flat after the Crude Oil price rose.

US economic news

US economic growth which is measured by Gross Domestic Product (GDP) rose at a 1.4 per cent annual pace, in the March quarter, surpassing expectations GDP would remain unchanged at the 1.2 per cent rate reported last month. Despite the rise, it was actually the slowest growth rate since the second quarter of last year.

The uptick in GDP was fueled by a jump in consumer spending, which also provides a slightly more encouraging outlook for growth for this year.

Local economic news 

The RBA is expected to reveal the ‘Financial Aggregates’ publication, a report that includes private sector credit for May, which is basically outstanding loans across the economy.

Markets

Wall Street closed lower on Thursday: The Dow Jones Industrial Average fell 0.8 per cent to close at 21,287, the S&P 500 lost 0.9 per cent to close at 2,420 and the NASDAQ shed 1.4 per cent to close at 6,144.

European markets closed lower: London’s FTSE fell 0.5 per cent, Paris lost 1.9 per cent and Frankfurt shed 1.8 per cent.

Asian markets closed higher: Tokyo’s Nikkei added 0.5 per cent, Hong Kong’s Hang Seng rose 1.1 per cent, and China’s Shanghai Composite added 0.5 per cent.

And back home, the Australian share market closed stronger on Thursday: At the closing bell, The S&P/ASX 200 Index closed 62 points higher or 1.1 per cent higher to finish at 5,818. On the futures market the SPI is 67 points down.

Company news

Bega Cheese Limited (ASX:BGA) says the acquisition of Vegemite is likely to be delayed. The Australian diary company says the purchase of Mondelez International’s Australia and New Zealand grocery and cheese business was scheduled for completion (today) 30 June 2017, but it is now likely to be delayed as a result of the outage of Mondelez global IT network. Bega Cheese says its working with Mondelez IT teams to minimise the delay. Shares in Bega Cheese Limited (ASX:BGA) last traded 2.39 per cent higher to $6.42

To ex-dividends

One company is going ex-dividend today: GrainCorp Limited (ASX:GNC) is paying 15 cents fully franked.

Currencies

One Australian Dollar at 7:30AM was buying 76.84 cents, 59.08 Pence Sterling, 86.16 Yen and 67.17 Euro cents.

Commodities
Gold has lost $3.50 to $US1,246 an ounce.
Silver has fallen 16 cents to $US16.64 an ounce.
And Oil has gained 13 cents to $US44.87 a barrel.

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter with Prime7 and Win News.