OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract expected to open up 32 points.
Tensions between the U.S. and Iran have eased in recent days, with the spotlight on the Islamic Republic after it admitted last week that it accidentally shot down a Ukrainian passenger flight, killing 176 people.
The U.S. and China have both said they plan to sign a phase-one trade deal Wednesday, helping to defuse tensions that have roiled global markets for two years. The countries also have agreed to semiannual talks to resolve disputes.
Overnight Summary
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Australia’s S&P/ASX 200 index closed 0.4% lower at 6903.7, rattled by a U.S. jobs report for December that missed expectations and underscored how the pace of hiring slowed last year. The index’s declines were broad-based with financials, energy and materials stocks mostly lower.
ANZ dropped 0.4% to A$25.01, BHP eased 0.9% to A$39.53 and Woodside fell by 1.2% to A$35.43. Payments company Zip closed up 3.1% at A$3.64 after posting a strong 2Q trading update that positioned it for a possible beat of annual transaction-volume targets. The ASX 200’s decline is its second of the year so far.
U.S. stocks rose intraday on signs that geopolitical risks are in check as the U.S. and China prepared to sign a phase-one trade deal and authorities in Iran focused on domestic protest.
The S&P 500 gained 0.6% and the technology-heavy Nasdaq Composite added 0.9%, both hitting new intraday records. The Dow Jones Industrial Average rose 0.2%.
The gold futures price fell by US$9.10 or 0.6% to US$1,548.40 an ounce. Spot gold was trading near US$1,549 an ounce in late US trade. Iron ore rose by US$1.25 or 1.3% to US$94.50 a tonne.
Global oil prices fell by up to 1.6% on Monday. Investors focussed on healthy crude oil stockpiles in the US and the pressure placed on refinery margins. The Brent crude price fell by US78 cents or 1.2% to US$64.20 a barrel. And the US Nymex price fell by US96 cents or 1.6% to US$58.08 a barrel
The dollar edged higher intraday, led by gains against the British pound following the release of soft U.K. economic data that spurred increased speculation about a possible interest-rate cut by the Bank of England. The pound was recently down 0.5% at $1.3000, while the WSJ Dollar Index was up less than 0.1% at 90.28.
European stocks were mixed as traders assess disappointing U.K. economic data and look ahead to Wednesday’s expected signing of phase one trade deal between the U.S. and China. The pan-European Stoxx 600 fell 0.2% to 418.39 points, the DAX dropped 0.2% to 13,451.52.
The FTSE 100, however, rose 0.4% to 7617.60 points on a weaker pound after official data for November showed the U.K. economy contracted by 0.3% month-on-month and manufacturing and industrial production declined 1.7% and 1.2% respectively.
The U.S. and China have both said that they plan to sign a phase-one trade deal on Wednesday, defusing tensions that have roiled global markets for two years. The Shanghai Composite Index closed up 0.8%.
Hong Kong stocks ended the session higher as the market continues to rally ahead of this week’s signing of a U.S.-China trade deal. The benchmark Hang Seng Index rose 1.1% to 28954.94.
Indian shares ended higher, with the benchmark Sensex up 0.6% at 41859.69. ICICI Securities expects ongoing positive momentum to help boost bank stocks, adding that investors are likely to focus on upcoming domestic earnings as well as geopolitical-related headlines.
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