US flash spike in treasury bonds drags equities down: Aus shares set to open lower


Aussie shares are poised to drop at the open following a retreat in US markets. Rising US bond yields seem to have spooked investors. The 10-year Treasury yield experienced a flash spike, overnight, rising 0.2 per cent. It’s now sitting around the 1.5 per cent mark. The jump placed the benchmark rate above the S&P 500′s dividend yield, which in essence means that equities, which are generally considered to be riskier assets have lost their premium over bonds. The rise also heightened fears of inflation and concerns that the US Fed may choose to lift interest rates earlier than expected. US tech stocks were the hardest hit, with Alphabet (NASDAQ:GOOGL), Facebook (NASDAQ:FB), Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT) all dropping over 2 per cent. Speaking of Facebook, the tech giant has reversed its Australian news ban after the government compromised on its proposed media code which is currently making its way through the Senate. A lot of positive headwinds in the Australian market today. Victoria is expected to announce an easing of Covid-19 restrictions this morning as the Holiday Inn cluster comes under control, and New South Wales has eased restrictions further as the state approaches its 40th day without any local cases. Reporting season rolls on with a number of companies expecting to release results today including Northern Star Resources (ASX:NST) and Orocobre (ASX:ORE).

Local economic news

Today we are expecting the Australian Bureau of Statistics to publish data on business conditions and sentiments for February, and the Reserve Bank of Australia to release private sector credit data for January.

Markets

Wall Street closed lower yesterday: The Dow Jones Industrial Average lost 1.8 per cent to 31,402, the S&P 500 lost 2.5 per cent to 3829 and the NASDAQ closed 3.5 per cent lower at 13,119.

European markets closed lower, London’s FTSE lost 0.1 per cent, Paris fell 0.2 per cent and Frankfurt closed 0.7 per cent lower.

Asian markets closed higher, Tokyo’s Nikkei gained 1.7 per cent, Hong Kong’s Hang Seng added 1.2 per cent and China’s Shanghai Composite closed 0.6 per cent higher.

Taking all of this into equation, the SPI futures are pointing to a 1.4 per cent fall.

Yesterday, the Australian share market closed 0.8 per cent higher at 6834.

Company news

Healthia (ASX:HLA) says underlying revenue grew 39 per cent to $61.5 million for the half-year ended 31 December 2020. Underlying EBITDA grew 91 per cent over the half to $11 million. Underlying net profit after tax and amortisation was $4.7 million, representing growth of 86 per cent. The growth is no surprise given the string of acquisitions Healthia made during the half. 55 allied businesses were acquired during the period. The company has declared a fully franked interim dividend of 2 cent per share. Shares in Healthia (ASX:HLA) closed 4.14 per cent lower at $1.62 yesterday.

Ex-dividends

BlueScope Steel Ltd (ASX:BSL) is paying 6 cents unfranked.
Coles Group (ASX:COL) is paying 33 cents fully franked.
Lendlease Group (ASX:LLC) is paying 15 cents 37.2 per cent franked.
McPherson's Ltd (ASX:MCP) is paying 3.5 cents fully franked.
Partners Grp Global (ASX:PGG) is paying 0.6834 cents unfranked.
Pental Ltd (ASX:PTL) is paying 1 cents fully franked.
Adacel Technologies (ASX:ADA) is paying 2.75 cents unfranked.
Alumina Limited (ASX:AWC) is paying 3.6821 cents fully franked.
BlueScope Steel Ltd (ASX:BSL) is paying 6 cents unfranked.
Carlton Investments (ASX:CIN) is paying 26 cents fully franked.
Coles Group (ASX:COL) is paying 33 cents fully franked.
Fiducian Group Ltd (ASX:FID) is paying 12.3 cents fully franked.
Johns Lyng Group (ASX:JLG) is paying 2.2 cents fully franked.
Lendlease Group (ASX:LLC) is paying 15 cents 37.2 per cent franked.
Microequities Asset Management Group (ASX:MAM) is paying 2 cents fully franked.
McPherson's Ltd (ASX:MCP) is paying 3.5 cents fully franked.
MCP Income Opportunities Trust (ASX:MOT) is paying 0.83 cents unfranked.
MCP Master Income (ASX:MXT) is paying 0.65 cents unfranked.
NAOS Ex-50 Opportunities Company (ASX:NAC) is paying 1.4 cents fully franked.
NAOS Small Cap Opportunities Company Ltd (ASX:NSC) is paying 1.25 cents fully franked.
Partners Grp Global (ASX:PGG) is paying 0.6834 cents unfranked.
Pental Ltd (ASX:PTL) is paying 1 cents fully franked.

Currencies

One Australian Dollar at 8:15 AM was buying 78.72 US cents, 56.18 Pence Sterling, 83.62 Yen and 64.68 Euro cents.

Commodities

Iron Ore has gained 0.9 per cent to US$174.24.
Iron Ore futures suggest 1.5 per cent gain.
Gold has lost $27.10 to US$1771 an ounce.
Silver was down $0.48 to US$27.45 an ounce.
Oil was down $0.22 to US$63.44 a barrel.
 

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