Australian shares are set to drop sharply at the open after US shares fell again on Monday. Wall Street's three major indices each slid more than 2 per cent, with the benchmark S&P 500 hitting a new low for 2018. Fears of rising interest rates appear to have spooked investors with the Federal Reserve expected to hike its benchmark rate for a fourth time on Wednesday.
Wall Street closed lower yesterday: The Dow Jones Industrial Average lost 2.1 per cent lower to 23 593 the S&P 500 shed 2.1 per cent to close at 2546 and the NASDAQ lost 2.3 per cent to close at 6754.
European markets closed lower: London’s FTSE shed 1.1 per cent, Paris lost 1.1 per cent and Frankfurt dropped 0.9 per cent.
Asian markets were mixed: Tokyo’s Nikkei gained 0.6 per cent, Hong Kong’s Hang Seng lost 0.03 per cent, and China’s Shanghai Composite was up 0.2 per cent.
Returning home, the SPI futures pointing to a fall of 85 points. Yesterday the Australian share market closed 56 points higher to 5658.
Local economic news
The Reserve Bank is due to release the minutes from the latest board meeting today.
Fletcher Building (ASX:FBU) has announced the sale of the Formica Group to Broadview Holding for US$840 million. CEO, Ross Taylor says the divestment of Formica completes the company's strategy to exit non-core businesses. The proposed sale is subject to regulatory approvals. Shares in Fletcher Building (ASX:FBU) closed 1.3 per cent lower to $4.58 yesterday.
Plato Inc (ASX:PL8) is going ex dividend today and is paying 0.5 cents fully franked.
One Australian Dollar at 8:30AM was buying 71.77 US cents, 56.92 Pence Sterling, 80.98 Yen and 63.26 Euro cents.
Iron ore is 0.4 per cent lower and is trading 70.47 a tonne. The iron ore futures are eyeing a fall of 0.6 per cent
Gold has gained $8.50 to US$1250 an ounce.
Silver is 10 cents higher at US$14.33 an ounce.
Oil has lost $2.04 to US$49.43 a barrel.