Monday: 5th March 2018

OPENING CALL: The Australian market looks to open higher with SPI Futures up 12 points.

Australian stocks are expected to recover some of last week’s losses suffered on the back of US President Donald Trump’s tariffs announcement.
The major US stock indexes posted their worst week of losses since early February as President Donald Trump’s threat to impose import tariffs on steel and aluminum rattled investors.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

Australian stocks are expected to recover some of last week’s losses suffered on the back of US President Donald Trump’s tariffs announcement.
At 0700 AEDT on Monday, the share price futures index was up 12 points, or 0.2 per cent, at 5,924.
In economic news on Monday, the Australian Bureau of Statistics will release building approvals data for January, ANZ will release its consumer confidence report and the Ai Group will release its Australian Performance of Services Index.
Meanwhile the Australian dollar was slightly higher against the US dollar after financial markets stabilised somewhat after the initial shock from the US government’s announcement that it will impose tariffs on its trading partners.
At 0700 AEDT on Monday, the Australian dollar was worth 77.70 US cents, up from 77.61 US cents on Friday.

US Markets

The major US stock indexes posted their worst week of losses since early February as President Donald Trump’s threat to impose import tariffs on steel and aluminium rattled investors.
However, small gains were posted on Friday, as investors spooked by the prospect of a global trade war backed off those concerns and noted a trade war was far from certain at this point.
Trump on Thursday threatened a 25 per cent tariff on steel imports and 10 per cent on aluminium without exemptions for any countries, igniting a selloff in a market already on edge over rising US interest rates and bond yields.
The tariffs could dampen profits for everything from car makers to beer companies and result in higher prices for consumers.

Commodities

Shares of companies that produce steel and aluminum swung before closing higher Friday, a day after rising on the official announcement of U.S. tariffs on the metals.
IRON ORE: $75.80 -1.52(April contract)

Oil Futures

Oil prices climbed back from early losses to settle higher Friday as prices reacted to moves in equities and the dollar.
U.S. crude futures settled up 26 cents, or 0.43%, to $61.25 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, rose 54 cents, or 0.85%, to $64.37 a barrel.

Forex

The dollar declined Friday, as concerns over trade protectionism continued to ripple through markets.
The WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, was recently down 0.3%, at 83.73.
President Donald Trump’s pledge Thursday to impose tariffs on steel and aluminum imports has unnerved some investors, who fear the measures could spark inflation and provoke retaliation from U.S. trade partners. Big holders of U.S. Treasurys, including China, Japan and the European Union, could sell U.S. assets in response, some analysts said.
Australian Dollar:
The Australian dollar is slightly higher against the US dollar after financial markets stabilised somewhat after the initial shock from the US government’s announcement that it will impose tariffs on its trading partners.
At 0635 AEDT on Monday, the Australian dollar was worth 77.70 US cents, up from 77.61 US cents on Friday.

European Markets

The spectre of a global trade war also sent European stocks tumbling .
Europe’s STOXX 600 index fell over 1.5 per cent led by a near five per cent slump from world’s biggest steelmaker ArcelorMittal SA and 2.5 – 6 per cent drops from the region’s carmakers worried that they might be next.

Asian Markets

Stock markets in Asia extended Wall Street’s overnight rout on Friday, with investors spooked by a possible trade war.
MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.9 per cent, while Japan’s Nikkei tumbled 2.5 per cent. For the week, they are down 2.1 per cent and 3.3 per cent respectively.
Shares in Asian steelmakers slid, with South Korea’s Posco falling 3.3 per cent and Japan’s Nippon Steel down 3.8 per cent.
Toyota Motor shares were down 2.4 per cent after the automaker said the planned tariffs would substantially raise the production costs and therefore prices of cars and trucks sold in America.
In China, Shanghai composite index dropped 0.6 per cent.
The S&P/NZX 50 index fell 0.65 per cent, to 8,288.42.

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