Australian shares are set to open lower, after Wall Street stocks were mixed as manufacturers were stung by trade tensions once again with the Trump administration looking at potentially raising tariffs on $US200 billion worth of Chinese goods. Apple saw a record positive earning report helping tech shares.The Federal Reserve reported the US economy as strong, keeping the bank on track to increase borrowing costs in September. The yield on the US 10-year Treasury note reached 3 per cent for the first time since June 13. And Rio Tinto (ASX:RIO) sold more assets, namely Queensland mines, giving a cash boost to shareholders.
On the commodities front, oil has dropped 91 cents and gold has dropped over $9 Iron Ore is trading at US$66.55 a tonne that down 2.4 per cent. and the futures for iron ore are suggesting a 1 per cent fall.
Local economic news
ABS will release estimates for 15 months of the major aggregates for international trade in goods and services today.
Wall Street closed mixed on Wednesday. The Dow Jones Industrial Average lost 0.3 per cent to close at 25,334, the S&P 500 closed 0.1 per cent lower to close at 2,813 and the NASDAQ gained 0.5 per cent to close at 7707.
European markets closed lower yesterday: London’s FTSE dropped 1.2 per cent, Paris fell 0.2 per cent and Frankfurt closed 0.5 per cent lower.
Asian markets closed mixed, Tokyo’s Nikkei added 0.9 per cent lower, Hong Kong’s Hang Seng fell 0.9 per cent and China’s Shanghai Composite dropped 1.8 per cent.
On the futures markets, the ASX futures are pointing to a 19 points loss. Yesterday, the Australian share market closed lower with the S&P/ASX 200 Index losing 5 points to close at 6276.
Yesterday, after the market closed, Rio Tinto (ASX:RIO) released their 2018 half year results. Underlying EBITDA rose 2 per cent to US$9.2 billion, for the six months to the end of June compared to the same time last year. While its underlying earnings for the six months rose by 12 per cent, to US$4.4 billion – this was less than UBS forecast. Despite this, Rio has announced an increased interim dividend that will see $US2.2 billion distributed to shareholders and a US$1 billion increase in its existing share buy-back program. Around $4.3 billion of the capital return came from mining operations, while $5.4 billion was generated by selling assets, mainly its Queensland coal mines for under $4 billion. Swiss company Glencore bought Rio's stake in the Hail Creek coal mine and Valeria coal development project for $1.7 billion, and joined with a private equity group and an Indonesian coal miner to buy the Kestrel underground coal mine for $2.25 billion. Rio said it expected to pay around $1 billion in tax on the transaction.
Shares in Rio Tinto (ASX:RIO) closed 0.6 per cent higher to $81.65.
One company is going ex-dividend today.
Ashley Services Group (ASX:ASH) is paying 2.5 cents fully franked.
One Australian Dollar at 7:40AM was buying 74.05 US cents, 56.43 Pence Sterling, 82.72 Yen and 63.51 Euro cents.
Iron ore futures are pointing to 1.0 per cent fall.
Gold dropped $9.10 to $US1225 an ounce.
Silver was down 17c at $US15.39 an ounce.
Oil dropped 91c to $US67.85 a barrel.
The three most traded cryptocurrencies are trading lower: Bitcoin has dropped 2.8 per cent to US$7531, Ethereum has lost 4.8 per cent to US$413 and EOS was down 1 per cent to US$7.21.