Steep sell-off on Wall St: Aus shares to open lower | Finance News Network

Steep sell-off on Wall St: Aus shares to open lower

Market Reports

by Kathy Skantzos

Wall Street has continued to slide into negative territory, with the Dow declining up to 1,500 points during the session, falling to a more than 1,100 point loss by the closing bell to finish below 25,000 points, erasing gains seen early on this year. The tech-heavy Nasdaq edged towards a 4 per cent loss by the session’s close, even though Apple and Amazon saw gains. The S&P fell more than 5 per cent from a record high just a month ago, down more than 4 per cent by close.

The White House has commented it is concerned about the stock market drop seen so far this week. Investors are feeling the pressure of interest rate hikes and wage pressure concerns. The benchmark 10-year yield also rose to the highest levels in four years.

Oil is continuing to drop, which is affecting the energy markets. Good gains are seen in iron ore, which will lessen some of the damage we can expect on the ASX today.

US economic news

The Institute for Supply Management Non-Manufacturing PMI index increased in January to the strongest expansion in the services sector since August 2005, driven by rising production and employment, beating market expectations.

Local economic news

The Reserve Bank will make an announcement today.

Retail trade figures for December will be out, which increased 1.2 per cent in November.

International trade figures for the month will also be released. The latest figures show exports are steady and imports have increased.

Figures

Wall Street closed in the red yesterday: The Dow Jones Industrial Average slipped 4.6 per cent to close at 24,346, the S&P 500 dropped 4.1 per cent to close at 2,649 and the NASDAQ fell 3.8 per cent to close at 6,968.

European markets closed lower: London’s FTSE dropped 1.5 per cent, Paris lost 1.5 per cent and Frankfurt lost 0.8 per cent.

Asian markets closed mixed: Tokyo’s Nikkei dropped 2.6 per cent, Hong Kong’s Hang Seng fell 1.1 per cent, and China’s Shanghai Composite increased 0.7 per cent.

And back home, the Australian share market closed lower yesterday: The S&P/ASX 200 Index closed 95 points down to finish at 6,026.

On the futures market the SPI is 139 points down.

Company news

Real estate investment trust (REIT) Shopping Centres Australasia Property Group (ASX:SCP) has announced a 66 per cent loss in statutory net profit after tax to $69.9 million for the half year compared to the same time the previous year. The company says this is due to a smaller increase in investment property valuations compared to the prior period. Its investment property portfolio value gained $73 million due to $38 million in acquisitions, and the company’s funds from operations increased 4.9 per cent to $56 million for the half year. Woolworths saw improved sales performance which helped lift the trust’s supermarket moving annual turnover by 2.7 per cent. Shares in Shopping Centres Australasia Property Group (ASX:SCP) closed flat at $2.21.

Reporting season

We can watch out for Magellan Financial Group (ASX:MFG), which is set to report financial results today.

Currencies

One Australian Dollar at 8:45AM was buying 78.83 US cents, 56.45 Pence Sterling, 86.12 Yen and 63.67 Euro cents.

Commodities

Gold has gained $4.40 to $US1,342 an ounce.
Silver has lost $0.01 to $US16.70 an ounce.
Oil has lost $1.85 to $US63.60 a barrel.

Cryptocurrencies

Bitcoin has fallen 11.8 per cent to $7,246.
Ethereum fallen about 13 per cent to $721.
Tether has gained about 0.3 per cent to $0.99.