Outlook: Aus shares set to open lower

Market Reports

by David Chau

It looks like the Australian share market will open lower this morning, following weak leads from Post-Brexit global markets.

Yesterday, Wall Street had its worst two-day drop in 10 months. Eight out of the 10 industry sectors posted losses, with the Financial industry being the worst performer of them all.

Brexit news

Standard & Poor’s has slashed Britain’s credit rating from AAA, down to AA. S&P says the UK’s outlook is negative, and that Brexit is a “seminal event” which will lead to less predictability and stability for the UK’s policy framework.

Also, a number of European Union governments have put pressure on the UK to leave the Union as soon as possible. However, UK Prime Minister, David Cameron (who will step down by October), says the UK will not be rushed into negotiations and that Britain alone will decide when to exit the EU.

Markets

The Dow Jones Industrial Average lost 1.5 per cent to close at 17,140, the S&P 500 lost 1.8 per cent to close at 2,001 and the NASDAQ fell by 2.4 per cent to close at 4,594.

European markets closed lower: London’s FTSE lost 2.6 per cent, Paris lost almost 3 per cent and Frankfurt lost 3 per cent.

Asian markets closed mixed: the Nikkei gained 2.4 per cent, the Hang Seng was down 0.2 per cent, and the Shanghai Composite gained 1.5 per cent.

The Australian share market closed higher yesterday: The ASX 200 closed 24 points up to finish at 5,137. On the futures market the SPI is down 67 points.

Currencies

The Australian Dollar at 7:30AM was buying $US73.45 cents, 55.58 Pence Sterling, 74.88 Yen and 66.66 Euro cents.

Company news:

Cyclopharm Ltd (ASX:CYC) has entered a strategic partnership with the Canadian Association of Nuclear Medicine. The company says this deal is for 5 years, under which they will assist the Canadian association through cash and in-kind support. Cyclopharm also says the partnership is consistent with its objective to develop the US market for Technegas, its lung ventilation imaging technology, following anticipated US FDA approval.

Cyclo shares traded 7.83% higher yesterrday at 89.5 cents.

The Supreme Court of Victoria has approved the scheme of arrangement for US clothing company, Hanesbrands Inc, to acquire all the shares in Pacific Brands Ltd (ASX: PBG). Pacific Brands says it will apply for its shares to be suspended from trading today.

Shares in Pacific Brands closed 0.44% higher yesterday at $1.15.

Commodities

Gold has gained 2.30 cents to $US1,325 an ounce for the August contract on Comex.
Silver has lost $0.05 to $17.79 for July.
Copper is up 1 cent to $2.13 cents a pound for July.
Oil is down $1.31 to $US46.33 a barrel for July light crude in New York.