Biden's US to remain tough on China: Aus shares to open lower

Market Reports

by Michael Luu

The Australian sharemarket is poised to open lower, following weak leads from the US. Wall Street’s blue-chip index Dow Jones shed over 200 points, disrupting its 2 consecutive weeks in the black. A sell-off in finance stocks triggered declines in American benchmark indices, following the Federal Reserve’s refusal to continue the coronavirus-fuelled capital break for banks and rising bond yields as a result. The impact echoed and was felt around the world, as Asia Pacific and European markets responded pessimistically to the stateside sell-off.

Meanwhile, last week’s US-China dialogue signalled renewed trade tensions between the rivalling nations, as Joe Biden’s administration extended its predecessor’s tough stance on China.

New spikes of infection rates across Europe have pushed countries back into stricter lockdown and plunged demand for crude and hence oil prices. Despite concerns over blood clots suffered by some recipients, Germany and France have resumed the rollout of the AstraZeneca vaccine.

Economic News

This week’s economic news flow will kick off on Tuesday, as Commonwealth Bank (CBA) Group economists release the weekly data on credit and debit card spending. Also ANZ-Roy Morgan issue the weekly consumer sentiment index.

On Wednesday, We will get to assess how trade surpluses have become the norm via the preliminary international trade report. IHS Markit will release the ‘flash’ (or preliminary) March survey results of purchasing managers.

On Thursday, the ABS will release labour force data on jobs by industry, finance and wealth for the December quarter and business conditions and sentiments for March.

Markets

To the figures from around the globe: Wall Street closed mixed on Friday: The Dow Jones Industrial Average lost 0.7 per cent to close at 32,628, the S&P 500 fell 0.1 per cent to 3913 and the NASDAQ closed 0.8 per cent higher at 13,215.

European markets closed lower: London’s FTSE fell 1.1 per cent, Paris also lost 1.1 per cent and Frankfurt closed 1.1 per cent lower.

Asian markets closed lower, Nikkei lost 1.4 per cent, Hong Kong’s Hang Seng also fell 1.4 per cent and China’s Shanghai Composite closed 1.7 per cent lower on Friday.

Taking all of this into equation, the SPI futures are pointing 0.2 per cent fall.

On Friday, the Australian share market lost 38 points to close at 6708.

Company News

New Zealand’s flag carrier Air New Zealand (ASX:AIZ) is prepared to commence non-stop flights between Auckland and Tasmania, as soon as a trans-Tasman travel bubble receives the green light from New Zealand’s Prime Minister Jacinda Ardern. This will be the first new air route operated by the aviation company since COVID-19 struck international travel. The news came on the back of a hint at quarantine-free travel between Australia and New Zealand by Ms Ardern’s second-in-command Grant Robertson. He revealed that Australia and its Oceanic neighbour are “not too far off ” establishing 2-way travel between 2 nations. Once operational, the new service will utilise its A320 neo fleet and run at a 2-per-week frequency. Shares in Air New Zealand (ASX:AIZ) closed 2.39 per cent higher at $1.72 on Friday


Ex-Dividends
Blackmores Limited (ASX:BKL) is paying 29 cents fully franked
Kelly Partners Group (ASX:KPG) is paying 0.33 cents fully franked
NRW Holdings Limited (ASX:NWH) is paying 4 cents fully franked

Currencies
One Australian Dollar at 7:40 AM was buying 77.13 US cents, 55.76 Pence Sterling, 83.81 Yen and 64.89 Euro cents.


Commodities
Iron Ore has lost 3.1 per cent to US$161.39.
Iron Ore futures suggest a 1.5 per cent fall.

Gold has gained $9.30 to US$1744 an ounce.
Silver has lost $0.03 US$26.32 an ounce.
Oil has gained $1.42 to US$61.42 a barrel.


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