N Korea weighs on world markets: ASX to see hesitant open

Market Reports

by Jessica Amir

In the wake of the US and North Korea tension Wall Street, Asian markets and European markets have all closed in red territory. It comes as North Korea responded to President Donald Trump’s warning, with the country saying it would consider hitting US territory Guam with a missile strike.

The Dow Jones fell by about 37 points, with Walt Disney adding the most losses, the broader S&P 500 closed around breakeven, and the tech heavy Nasdaq also softened. For the sectors, Healthcare and non-cyclical goods and services saw the least losses.

On the commodity front, Gold, the safe haven precious metal, has risen to a two-month high on the geopolitical tension. Oil meantime has pushed higher after another welcome drop in US crude stockpiles.

With all of that in consideration our Australian share market is tipping a single digit gain.


US economic news now

US unit labor costs rise 0.6 per cent in the June quarter, which follows a 5.4 per cent in the March quarter according to Labor Department. Although June’s quarter was somewhat weaker compared to the prior period, if you compared it to the second quarter of 2016, where the US saw a fall of 0.2 per cent rate, you can see things are improving.

Markets  

Wall Street closed lower: The Dow Jones Industrial Average fell 0.17 per cent to close at 22,049 the S&P 500 fell 0.04 per cent to close at 2,474 and the NASDAQ slipped 0.28 per cent to close at 6,352.

European markets closed lower: London’s FTSE lost 0.6 per cent, Paris fell 1.4 per cent and Frankfurt dipped 1.1 per cent.

Asian markets lower: Tokyo’s Nikkei shed 1.3 per cent, Hong Kong’s Hang Seng lost 0.4 per cent, and China’s Shanghai Composite fell 0.2 per cent.

And back home, the Australian share market closed higher yesterday: At the closing bell, The S&P/ASX 200 Index closed 22 points higher or 0.4 per cent up for the day at 5,766.

On the futures market the SPI is 6 points up.

Company news

Elders (ASX:ELD) has refinanced its $75 million multi-option facility on improved terms. The Australian based agribusiness refinanced its facility, which includes an uncommitted $25 million accordion clause for acquisitions, which gives the business an option to add a new term loan. Elders says the finance will reduce its costs and improve efficiency throughout the business, while also giving the firm a platform for ongoing growth. Elders also retained its banking relationship with ANZ (ASX:ANZ), NAB (ASX:NAB) and Rabo. Shares in Elders (ASX:ELD) last traded 1.22 per cent higher to $4.99 yesterday.

Ex-dividends

Two ASX200 companies are going ex dividend.

Milton Corporation (ASX:MLT) is paying 10 cents fully franked and Rio Tinto (ASX:RIO) is paying $1.37 fully franked.

Reporting season

There are a quite a few companies reporting results today. We can watch out for

AGL (ASX:AGL) with expectations FY17 NPAT will be $744.2 million, AMP (ASX:AMP) will report its half year 2017 results with NPAT expected to come in at $460 million. We also can eye results for Aventus Retail Property Fund (ASX:AVN), Magellan Financial Group (ASX:MFG), Orora (ASX:ORA) and VHP Healthcare Property Trust (ASX:VHP).

Currencies

One Australian Dollar at 7:30AM was buying 78.86 US cents, 60.65 Pence Sterling, 86.73 Yen and 67.08 Euro cents.

Commodities

Gold has gained $20.60 to $US1,283 an ounce.
Silver has added $0.54 to $US16.93 an ounce.
And Oil has increased by $0.53 to $US49.70 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.