Opening Call: The Australian share market is to open higher.
U.S. stocks finished mixed as oil prices fell to a three-week low on worries that the Delta variant will crunch demand. The 10-year Treasury note yield traded at 1.32%, compared with 1.29% on Friday. The WSJ Dollar Index rose 0.20% to 87.59. Gold futures fell more than 2% and ended at their lowest level since March.
Australia’s S&P/ASX 200 index ended unchanged amid gains by financial stocks. NAB rose 0.9% after announcing plans to buy Citigroup’s Australian consumer business. Westpac gained 1.0% after saying it had agreed to sell its Australian Life Insurance Business to TAL for A$900 million. The other main banks, CBA and ANZ, added 1.2% and 1.4%, respectively. The materials and industrials sectors dragged on the benchmark index.
U.S. stocks were mixed as a tumble in oil prices signalled investor unease about the Covid-19 pandemic and the strength of the economic recovery. The Dow Jones Industrial Average lost 0.3%, while the S&P 500 slipped about 0.1%. The technology-heavy Nasdaq Composite rose 0.2%. Stocks are near records, with the S&P 500 notching a high on Friday. Stocks are likely to keep rising in the medium term, fueled by economic recovery and strong corporate earnings, but some short-term hiccups are likely, said Jon Adams, senior investment strategist and portfolio manager at BMO Global Asset Management.
Gold futures finished at their lowest level since March, after falling more than 5% during Asian trading hours. December gold finished 2.1% lower at $1,732.00 an ounce. There wasn’t a clear catalyst for the session’s declines but strategists and other market participants attributed the sharp drop in trade in Asian hours to low volumes and persistent concerns about the prospect for precious metals after better-than-expected U.S. jobs report on Friday.
Oil futures ended lower, extending last week’s tumble as China took additional steps to limit the spread of the Delta variant of the coronavirus that causes Covid-19, underlining fears about global crude demand. West Texas Intermediate crude for September delivery fell 2.6%, finishing at $66.48 a barrel on the New York Mercantile Exchange. October Brent crude, the global benchmark, dropped 2.4% to settle at $69.04 a barrel on ICE Futures Europe.
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.1768 to lows near US$1.1733 and was near US$1.1735 at the US close. The Aussie dollar fell from highs near US73.62 cents to session lows near US73.29 cents at the US close. The Japanese yen eased from near 110.02 yen per US dollar to near JPY110.35 at the US close.
European share markets edged higher on Monday. The pan-European STOXX 600 index rose by 0.2% to a record closing high, led by gains in health care (+1.0%) stocks. Deliveroo shares jumped 4.5% after Delivery Hero (-3.2%) took a 5.1% stake in the British food delivery company. The German Dax index edged lower by 0.1%, but the UK FTSE index was up just 0.1%. London-listed shares in Rio Tinto (+0.9%) and BHP (+0.4%) both lifted.
Japan’s Tokyo Stock Exchange was closed for the Mountain Day holiday. Chinese stocks ended mixed, as property and financial shares rebounded while some new-energy-related companies retreated. The Shanghai Composite Index advanced 1.1%, the Shenzhen Composite Index was 0.8% higher and the ChiNext Price Index dropped 1.0%.