US markets close in positive territory: Aus shares to open higher

Market Reports

by Kathy Skantzos

The US markets have recovered from the huge loss seen yesterday. There was a yo-yo effect on the Dow, but it finished 567 points by the closing bell, rising as much as 600 points during the session. All the major indices have managed to finish higher. Technology was the best performing sector, lifting the Nasdaq up by 2.1 per cent and sending the S&P 500 1.7 per cent higher.

The ASX futures have turned positive and the Australian dollar is also up slightly.

Gold has dropped, and oil is down more than 1 per cent.

US economic news

Exports of goods and services increased 1.8 per cent to an all-time high of US$203.4 billion in December. Imports increased 2.5 per cent to an all-time high of US$256.5 billion in December.

The Census Bureau recorded a balance of trade gap of US$53.1 billion in December, which is the biggest trade gap since October 2008.

Local economic news

The AIG/HIA construction index will be out today, which fell in December sue to slow expansion in construction activity.

Figures

Wall Street closed higher yesterday: The Dow Jones Industrial Average gained 2.3 per cent to close at 24,913, the S&P 500 added 1.7 per cent to close at 2,695 and the NASDAQ gained 2.1 per cent to close at 7,116.

European markets closed lower: London’s FTSE dropped 2.6 per cent, Paris lost 2.4 per cent and Frankfurt dropped 2.3 per cent.

Asian markets closed lower: Tokyo’s Nikkei dropped 4.7 per cent, Hong Kong’s Hang Seng dropped 5.1 per cent, and China’s Shanghai Composite lost 3.4 per cent.

And back home, the Australian share market closed lower yesterday: The S&P/ASX 200 Index closed 193 points down to finish at 5,833.

On the futures market the SPI is 99 points up.

Company news

Commonwealth Bank (ASX:CBA) reports 1.9 per cent fall in half yearly cash net profit after tax to $4.73 billion. Cash earnings per share reduced by 3.2 per cent. The results were affected by a civil penalty of $375 million from the AUSTRAC federal court proceedings against the bank. There is an additional $200 million in regulatory, compliance and remediation costs including expenses for the Royal Commission. Before retiring in April this year, CEO Ian Narev says the bank focused on fixing its mistakes and recognises that costs arose from its failure to meet some standards. The bank is paying a dividend of $2.00, which is 1 per cent higher. Shares in Commonwealth Bank (ASX:CBA) last traded 3.01 per cent lower at $77.40.

Reporting season

We can watch also out for Carsales.com (ASX:CAR), MG Unit Trust (ASX:MGC), an Rio Tinto (ASX:RIO) which are set to report financial results today.

Ex-dividends

One company is going ex-dividend today: ResMed (ASX:RMD) is paying 3.07 cents unfranked.

Currencies

One Australian Dollar at 8:50AM was buying 79.02 US cents, 56.67 Pence Sterling, 86.59 Yen and 63.84 Euro cents.

Commodities 

Gold has lost $10.60 to $US1,326 an ounce.
Silver has lost $0.10 to $US16.57 an ounce.
Oil has lost $0.74 to $US63.41 a barrel.

Cryptocurrencies

The three most traded cryptocurrencies are tracking higher.

Bitcoin has gained 9 per cent to $7,823.
Ethereum gained 11 per cent to $796.
Tether gained 1.1 per cent to $1.01.