Wall Street sell off continues: Aus shares to slump

Market Reports

by Anna Napoli

 Following weak leads from US markets, the Australian share market looks set to open lower. The sell-off on Wall Street continued on Friday amid mounting fears of a trade war between the US and China. On Thursday President Trump announced he will impose restrictions on nearly $50 billion dollars worth of Chinese imports. China responded with plans to target 128 US products accounting for roughly $3 billion in imports. The major benchmarks posted their biggest weekly loss since January 2016.

On the commodities front, oil has hit a 2 month high and gold is up $18. 

US economic news:

On Friday the US Federal Housing finance Agency released the US house price index for January. Average house prices increased 0.8 per cent for the month, the market was expecting a lift of 0.5%

Local economic news due out this week,

On Tuesday we can look out for new home sales results from the Housing Industry of Australia. Sales declined by 2.1 per cent in February. On Thursday, the ABS releases the latest data on job vacancies – a key leading indicator of the job market. In the three months to November job vacancies rose by 2.7 per cent. Job vacancies are up 16.1 per cent on a year ago – the strongest annual growth rate in 7 years.


Markets:

Wall Street closed lower on Friday: The Dow Jones Industrial Average lost 1.8 per cent to close at 23,533, the S&P 500 dropped 2.1 per cent to close at 2,588 and the NASDAQ lost 2.4 per cent to close at 6993.

European markets closed lower on Friday: London’s FTSE fell 0.4 per cent, Paris lost 1.4 per cent and Frankfurt dropped 1.8 per cent.

Asian markets closed lower: Tokyo’s Nikkei dropped 4.5 per cent, Hong Kong’s Hang Seng fell 2.5 per cent, and China’s Shanghai Composite lost 3.4 per cent.
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Taking all of this into consideration, the ASX futures are pointing to a 51 points fall. On Friday the Australian share market closed lower with the S&P/ASX 200 Index dropping 116 points to 5821.

Company news: 

Billabong (ASX:BBG) has issued a statement from Boardriders, the company poised to take it over. Boardriders has warned shareholders against placing undue weight on media reports concerning the proposed takeover, and, to instead consult the scheme booklet they were issued with in February. US-based Boardriders lobbed a $1-a-share bid for debt-laden Billabong in January. The Billabong board of Directors including major shareholder Gordon Merchant have unanimously voted in favour of the acquisition. Shares in Billabong International (ASX:BBG) closed 2.62 per cent lower at $0.93 on Friday.

Ex-dividends

A number of companies are going ex-dividend today: Cedar Woods (ASX:CWP) is paying 12 cents fully franked, Seek (ASX:SEK) is paying 24 cents fully franked and Seven group Holdings (ASX:SVW) is paying 21 cents also fully franked.

Currencies

One Australian Dollar at 7:45AM was buying US77.04 cents, 54.54 Pence Sterling, 80.65 Yen and 62.38 Euro cents.

Commodities

Gold has gained almost $20 to $US1356 an ounce.
Silver has added $0.20 to $US16.58 an ounce.
Oil jumped $1.72 to $US65.88 a barrel.

Cryptocurrencies

The three most traded cryptocurrencies are trading lower: Bitcoin has fallen 3.31 per cent to US$8611, Ethereum dropped about 2 per cent to US$527 and Storm has lost over 10 per cent to US$0.05.