China pledges support to markets over coronavirus: ASX poised to open lower

Market Reports

by Rachael Jones

Following weak leads from US markets, the Australian share market looks set to open lower this morning. China’s work and travel restrictions to contain coronavirus are deferring the payout investors had expected after the US-China trade deal. Bond yields hit old lows. Apple’s decision to temporarily shut its stores in China as a result of the virus could delay up to 1 million iPhone sales, but is unlikely to have a substantial impact on the company’s revenue analysts said at the weekend. On the commodities front, gold and oil are both down.

Local economic news 

ABS

Monday 

Building Approvals, December 2019.

Wednesday

Selected Living Cost Indexes, December 2019.

Thursday

International Trade in Goods and Services, December 2019.

Retail Trade, December 2019.

Markets

Wall Street closed lower on Friday: The Dow Jones Industrial Average dropped 2.1 per cent to close at 28,256, the S&P 500 fell 1.8 per cent to close at 3226 and the NASDAQ shed 1.6 per cent to 9151.

European markets closed lower on Friday: London’s FTSE fell 1.3 per cent, Paris dropped 1.1 per cent and Frankfurt closed 1.3 per cent lower.

Asian markets closed also mixed on Friday: Tokyo’s Nikkei gained almost 1 per cent, Hong Kong’s Hang Seng fell 0.5 per cent and China’s Shanghai Composite was closed.

Taking all of this into equation, the SPI futures are pointing to 1.7 per cent fall. On Friday, the Australian share market closed 9 points (0.1 per cent) higher at 7017.

Company news

Water company Fluence Corporation (ASX:FLC) reports FY 2020 guidance for Smart Products Solutions revenue of at least US $32.0 million, up 20 per cent year on year, recurring revenue of US $9.0 million, up 30 per cent YoY and sustained EBITDA profitability. Q4 2019 saw gross bookings of US$25.4 million, with total backlog at 31 December 2019 at US$265.0 million. The company saw two significant follow-on orders in China, and US$5.0 million Smart Products Solution in Argentina with Increased recurring revenue backlog by signing operation and maintenance agreement in Caribbean. Shares in Fluence Corporation (ASX:FLC) closed 4.82 per cent lower at $0.40 on Friday.

Ex-Dividends

MFF Capital Investments Ltd (ASX:MFF) is paying 20 cents fully franked
NB Global Corporate Income Trust (ASX:NBI) is paying 0.8991 cents unfranked
Ozgrowth Limited (ASX:OZG) is paying 0.3 cents fully franked
Westoz Investment Company Limited (ASX:WIC) is paying 3 cents fully franked

Currencies

One Australian Dollar at 7:40 AM was buying 66.98 US cents, 50.84 Pence Sterling, 72.63 Yen and 60.45 Euro cents.

Commodities

Gold was down $1.30 to US$1588 an ounce.
Silver added 2 cents to US$18.01 an ounce.
Oil has lost $0.58 to US$51.56 a barrel.