Australian market expected to open lower 18/10/19

Australian market expected to open lower 18/10/19

OPENING CALL: The Australian share market is expected to open lower. The SPI200 futures contract expected to open down 13 points.

Saudi Arabian Oil will delay its initial public offering, with the timing of the possible IPO pushed back to December or January, say people familiar with the matter.  




 

Johnson & Johnson and its subsidiary Ethicon have reached a settlement of about $116.9 million with 41 states and the District of Columbia for allegedly misleading marketing of transvaginal surgical-mesh devices.  


 

Overnight Summary

 

 

Each Market in Focus

 

 

Australian shares snapped a five-session winning streak as miners led broad losses. The S&P/ASX 200 dropped 0.8% to settle at 6684.7 after extending a modest opening decline following the release of domestic jobs data that suggest the central bank might have room to pause on any further rate cuts.  

BHP, Rio Tinto and Fortescue together accounted for about a third of the day’s loss for the ASX 200 with a decline in iron-ore futures. Each of the big banks lost ground, while Bank of Queensland dropped 2.4% after warning of another tough year ahead. Only the energy subindex logged gains.  

The S&P 500 rose intraday, stoked by solid earnings reports from Netflix, Morgan Stanley and others, as well as a preliminary Brexit deal that has the potential to remove a major obstacle facing investors.  

More than a tenth of the companies in the S&P 500 have reported results so far and numbers are mostly coming in ahead of analysts’ expectations. That gave the stock market some support a day after weak retail sales data raised concerns that a major component of the economy, American consumers, were slowing their spending.  

The Nasdaq Composite also rose, adding 0.4%. The Dow Jones Industrial Average, meanwhile, hung onto a small gain, rising 0.1%, or 32 points, to 27034 despite a pullback in shares of International Business Machines. The Dow component weighed on the blue-chip index after reporting lackluster earnings a day earlier.  

 
 
Gold prices edged higher after the European Union and U.K. reached a preliminary Brexit deal, with worries that a deal may not pass a weekend vote in the British parliament and signs of a weakness in the U.S. economy providing support for the haven metal.  

Gold for December delivery on Comex climbed by $4.30, or 0.3%, to settle at $1,498.30 an ounce. Prices for the most-active contract settled at their highest since Oct. 10, according to FactSet data. In other commodity markets, December wheat prices rose 12 1/4 cents to $5.25 1/2. 

 

Oil futures settled higher, buoyed by news that the U.S. and Turkey agreed on a ceasefire in Syria, easing worries about tensions in the Middle East.  

Prices had been trading mostly lower after the Energy Information Administration early in the day reported a fifth consecutive weekly climb in crude-oil stockpiles. November West Texas Intermediate oil rose 57 cents, or 1.1%, to settle at $53.93 a barrel on the New York Mercantile Exchange.  

The WSJ Dollar Index recently was down 0.39% at 90.82. Sterling volatility is likely to persist and could fall to $1.22 if MPs vote against the Brexit plan of U.K. Prime Minister Boris Johnson on Saturday, said Jane Foley, senior foreign exchange strategist at Rabobank.  

The announcement of a Brexit deal agreed between the U.K. and EU’s negotiating teams sent GBP/USD to a five-month high of 1.2987 earlier. The currency pair is last well below that high at 1.2860 amid doubts MPs will back the deal after Northern Ireland’s Democratic Unionist Party and Labour leader Jeremy Corbyn said they would vote down the agreement.  

 

European stocks closed mixed as traders pondered news of a U.K. deal to leave the EU and the latest moves in U.S.-China trade talks.  

The Stoxx Europe 600 was down 0.1%, the FTSE 100 was up 0.2% and the DAX and CAC-40 fell 0.1% and 0.4% respectively.  

The U.K. government struck its latest exit deal with Brussels, but doubts remain about whether U.K. lawmakers will approve it in a special parliamentary sitting Saturday.  

 

Asian shares were mixed, with Japanese stocks ending down, weighed by weakness in financial stocks amid growing concerns about a U.S. economic slowdown.  

The Nikkei Stock Average eased 0.1% to 22451.86. Investors are focusing on Japanese corporate earnings in coming days. South Korea’s benchmark Kospi closed 0.2% lower, snapping a four-session winning streak. Electronics stocks including memory-chip and display makers were among the biggest losers. Investors largely remained on the sidelines amid a lack of fresh leads after weak U.S. retail sales data set a downbeat mood, with some taking profit on recent gains, said Kiwoom Securities.  

Hong Kong stocks closed higher as property developers and electronic-component makers rose. The Hang Seng Index ended the session 0.7% higher at 26848.49.  


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