Wednesday 14th August 2019

OPENING CALL: The Australian share market is expected to open higher. The SPI Futures is expected to be up 48 points.

Shares of department stores, discount chains and even toy makers rallied Tuesday after the U.S. said it would delay some tariffs against China until Dec. 15

Foxconn Technology’s net profit fell as its biggest customer, Apple, continued to struggle with weak iPhone sales.

Overnight Summary

Market Quotes by TradingView

Each Market In Focus

Australian Market

Australian shares ended a choppy session lower, snapping a four-session recovery as
trade tensions and worries about global growth resurfaced.
The S&P/ASX 200 closed down 0.3% at 6568.5.
Big banks weighed on the market and energy stocks faltered with weaker oil prices in
Asian trading, but it was the consumer discretionary and health care sectors that logged
the sharpest falls. The earnings front was quiet before a flurry of reports later in the
week, though Challenger ended up 2.5% on its full-year earnings and Magellan Financial
entered a trade halt as its annual report was accompanied by a capital raising.
National Australia Bank, closed 0.3% lower, ahead of its third quarter update early

US Markets

Stocks jumped intraday as news that the U.S. would delay some tariffs against China
rekindled investors’ hopes for an eventual trade truce.
The U.S. Trade Representative released a statement in Washington that the U.S. would
delay and remove items from the roughly $300 billion of Chinese imports facing 10%
tariffs on Sept. 1. The news sent investors rushing back into stocks after two days of
declines for major U.S. stock indexes and an extended bout of market volatility. They
also piled into commodities while shedding exposure to traditionally safer assets such as
government bonds and gold.
The S&P 500 advanced 1.6% in midday trading. The Dow Jones Industrial Average jumped
more than 400 points, or 1.6% after a sharp decline Monday extended a recent bout of
stock volatility. The Nasdaq Composite gained 1.9%. Shares of technology companies
outperformed. The S&P 500’s information-technology sector advanced about 2.2% in recent
trading, making it the best performing of the S&P’s 11 sectors.


Gold futures ended lower, falling sharply from their highest intraday levels in more
than six years, after the U.S. announced that it would delay tariffs on some Chinese
goods and scheduled further talks in an effort to resolve the trade dispute between the
two nations.
Prices for the yellow metal had climbed above $1,546 in early dealings, the highest
intraday level for a most-active contract since April 2013, according to FactSet data, as
investors kept an eye on protests in Hong Kong, the fallout from Argentina’s weekend
primary elections and recent sharp falls in equities markets, as well as worries over the
economic outlook tied to the U.S.-China trade war.
In other commodity markets, September wheat prices were up 1/4 cent at $4.72 cents.

Oil Futures

U.S. oil prices ended the session 4% higher — the biggest one-day leap in five weeks
— at $57.10 a barrel after the Trump administration said it would push back to
mid-December planned tariffs on many Chinese consumer goods that were due to go into
effect in a few weeks.


Argentina’s currency continued to lose ground against the dollar early in the day
following the unexpectedly strong showing of left-wing presidential candidate Alberto
Fernandez in Sunday’s primary election, which sparked concerns among investors about a
return to protectionism and state interference in the economy.
The dollar strengthened more than 10% against the Argentine currency in volatile early
trading, and was up 7.1% against the peso intraday, with one greenback buying 56.75
pesos. The peso lost about 15% against the dollar on Monday.
The WSJ Dollar Index was recently up 0.28% at 90.98.

European Markets

European stocks staged a turnaround following news on the delay of some U.S. tariffs on
China, with the Stoxx Europe rising 0.5% after falling as much as 1% earlier.
The index was up 1.99 points to 372.40.
London stocks closed higher. The FTSE 100 ended the session up 0.3% at 7250.90, helped
by mining stocks. Mining giant Anglo American topped the list of blue-chip gainers, up
2.6%, with Antofagasta, Glencore and Rio Tinto also among the biggest risers.
The French CAC-40 index was up 52.76 points, or 0.99%, to 5363.07, while the German DAX
was up 70.45 points, or 0.60%, to 11750.13.

Asian Markets

Stocks dropped around the world as protests in Hong Kong, a political shake-up in
Argentina and global trade tensions continued to fuel investors’ concerns about the
global economy.
A selloff in Hong Kong stocks accelerated, with the Hang Seng Index falling 2.1% amid
continued unrest.
Japanese stocks closed lower on broad selling amid growing skepticism of a U.S.-China
trade deal and the yen’s persistent strength. All 33 Topix sectors save one (textile)
close lower. The Nikkei Stock Average fell 1.1% to 20455.44.
South Korea’s benchmark Kospi fell 0.9% to 1925.83, snapping a three-session winning
streak as it was led lower by tech and auto stocks. Market sentiment is suffering from
growing doubts about a U.S.-China trade deal and the South Korea-Japan spat over
high-tech materials exports. This is pushing investors to keep fleeing from equities
toward safer assets, KB Securities said.
Malaysia’s stocks resumed trading after a public holiday to close at nearly a four-year
low, tracking weak markets across Asia. Market breadth was deeply negative, with losers
beating gainers by 744 to 173. The Kuala Lumpur Composite Index closed 1.4% lower at
Singapore’s Straits Times Index closed 0.7% lower at 3146.73 after the government
lowered its full-year GDP growth forecast. Index-heavyweight Singapore Telecommunications
closed 2.5% lower.
Indian shares closed broadly lower, although Reliance Industries was the top gainer on
news that Saudi Aramco had agreed to buy a 20% stake it its oil-and-chemicals business.
Shares closed 9.7% higher. Auto and financial stocks were among the biggest losers amid a
weak sentiment for equities across Asia.

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