The Australian sharemarket looks set to plummet after Wall Street suffered its worst day of the year. The falls came as a trade war between the US and China intensified with China retaliating against President Trump’s latest move. China's Commerce Ministry said that Chinese companies have stopped buying US agricultural products. China also allowed its currency to depreciate, a move called a "major violation" by the US President. A weaker yuan will make Chinese goods more competitive on the global stage. The Nasdaq has now fallen for six consecutive sessions, its longest losing streak since late 2016. Apple led the decline in tech stocks, losing 5.2 per cent.
Meantime investors have flocked to safe haven assets such as gold which surged as much as 2 per cent on Monday to the highest levels seen in more than six years.
Local economic news
Today all eyes will be on the Reserve Bank Board when it announces its interest rate decision this afternoon. Markets don't expect any movement on rates. The ABS is also due to release international trade data as well as the consumer price index.
Wall Street closed lower yesterday: The Dow Jones Industrial Average lost 2.9 per cent to close at 25,718, the S&P 500 dropped 3 per cent to close at 2845 and the NASDAQ fell 3.5 per cent to 7726.
European markets closed lower: London’s FTSE fell 2.5 per cent, Paris lost 2.2 per cent and Frankfurt was down 1.8 per cent.
Asian markets closed: Tokyo’s Nikkei fell 1.7 per cent, Hong Kong’s Hang Seng dropped 2.9 per cent and China’s Shanghai Composite closed lower, down 1.6 per cent.
Taking all of this into equation, the SPI futures are pointing to a fall of 1.7 percent. Yesterday, the Australian share market closed 128 points (1.9 per cent) lower at 6640.
Austal (ASX:ASB) has announced the successful delivery of a 49 metre high speed passenger ferry to SNC Aremiti. The $30 million project was awarded in late December 2017 and has been delivered by Austal’s Philippines shipyard. Austal Chief Executive Officer David Singleton said the high quality vessel demonstrated the capabilities of the Company’s recently expanded Philippines shipyard. Shares in closed 3.2 per cent lower yesterday at $3.92.
Australian Foundation (ASX: AFI) is paying 14 cents fully franked.
CVC Group (ASX:CVC) is paying 8 cents fully franked.
One Australian Dollar at 8:00 AM was buying 67.53 US cents, 55.64 Pence Sterling, 71.35 Yen and 60.25 Euro cents.
Iron Ore futures suggest a 0.9 per cent fall
Gold has added $18.20 to US$1476 an ounce.
Silver was gained 14 cents to US$16.41 an ounce.
Oil has shed 65 cents to US$55.01 a barrel.