Wall St slips as Fed holds rates: ASX to rise

Market Reports

by Melissa Darmawan

The Australian share market is set to rise despite Wall St dipping into the red. US stocks slipped as the Federal Reserve held rates and maintained their support for the economy. The reaffirmation on keeping interest rates and asset purchases steady, pressured bond yields as they struggled to keep its gains while helping technology shares minimize their losses following mixed company earnings results this week. The rise in oil prices boosted energy stocks after U.S. fuel oil inventories posted a large drawdown while refiners activity went up to its highest in over a year, boosting confident for rising fuel demand. Amid this, Facebook posted strong first quarter earnings beating market expectations, thanks to advertising revenue growth. The company’s revenue rose 48 per cent to $26.17 billion for the quarter when compared to last year. Facebook attributes the increase in revenue to a 30 per cent year-over-year increase in the average price per ad and a 12 per cent increase in the number of ads delivered. Meanwhile, President Joe Biden is expected to present his $1.8 trillion American Families Plan to the Congress proposing to increase capital gains tax for Americans making over $1 million per year.

Figures from around the globe

Wall Street closed lower yesterday: the Dow Jones Industrial Average fell 0.5 per cent to 33,820, the S&P 500 lost 0.1 per cent to 4,183 and the NASDAQ closed 0.3 per cent lower at 14,051.

European markets closed higher thanks to positive bank earnings results London’s FTSE added 0.3 per cent, Paris gained 0.5 per cent and Frankfurt closed 0.3 per cent higher.

Asian markets closed higher, Tokyo’s Nikkei added 0.2 per cent, Hong Kong’s Hang Seng gained 0.5 per cent and China’s Shanghai Composite closed 0.4 per cent higher.

Taking all of this into equation, the SPI futures are pointing to a 0.3 per cent gain.

Yesterday, the Australian share market closed 0.4 per cent higher at 7,065.

Local economic news

Today the international trade price indexes for export and import prices are scheduled by the Australia Bureau of Statistics.

In company news that broke after market close

Australian shipbuilder Austal (ASX:ASB) has entered discussions with Guangdong Jianglong shipbuilding company to sell 40 per cent of its stake in Aulong shipbuilding. The joint venture between the two companies was established in 2016 to focus on commercial passenger and non-military vessels in China. Austal (with 40% ownership) has licensed its aluminium vessel designs for marketing throughout mainland China with agreement for construction at Jianglong Shipbuilding’s facilities. Jianglong Shipbuilding (with 60% ownership) brings local shipbuilding infrastructure, 1000 employees and two shipyards supporting the joint venture. Shares in Austal (ASX:ASB) closed 1.61 per cent lower at $2.45 yesterday.

Ex-Dividends

Cadence Capital (ASX:CDM) is paying 2 cents fully franked
Gryphon Capital (ASX:GCI) is paying 0.73 cents unfranked
Perpetual Credit Income Trust (ASX:PCI) is paying 0.2917 cents unfranked
Qualitas Real Estate Income Fund (ASX:QRI) is paying 0.7927 cents unfranked
Steamships Trading Company (ASX:SST) is paying 23.8 cents unfranked
360 Capital Enhanced Income Fund (ASX:TCF) is paying 3 cents unfranked
WPP Aunz Ltd (ASX:WPP) is paying 15.6 cents fully franked

Currencies

One Australian Dollar at 8:00 AM was buying 77.91 US cents, 55.89 Pence Sterling, 84.62 Yen and 64.26 Euro cents.

Commodities

Iron Ore has lost 1.4 per cent to US$192.52
Iron Ore futures are pointing to 0.3 per cent fall.

Gold has lost $4.90 to US$1774 an ounce.
Silver has fallen $0.33 to US$26.12 an ounce.
Oil was up $0.92 to US$63.86 a barrel.