Thursday: 14th June 2018

OPENING CALL: The Australian market looks to open lower with SPI Futures down 5 points.

The Australian share market looks set to open slightly in the red following a much greater negative lead from Wall Street which has declined after the Federal Reserve’s interest rate decision.

US stocks have ended a choppy session lower after the Federal Reserve raised its interest rates as expected and projected a slightly faster pace of rate hikes in the coming months.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

The Australian share market looks set to open slightly in the red following a much greater negative lead from Wall Street which has declined after the Federal Reserve’s interest rate decision.
At 0700 AEST on Thursday, the share price futures index was down five points, or 0.08 per cent, at 6,022.
In economic news on Thursday, the Australian Bureau of Statistics is due to release labour force data for May.
No major equities news is expected, but all eyes will undoubtedly be on Australian infrastructure giant APA after its shares soared following a $13 billion takeover proposal from a Chinese consortium led by global infrastructure player CK Infrastructure Holdings.
Atlas Iron may also grab some attention after mining magnate Gina Rinehart’s move to secure a takeover blocking stake in the company.
The Australian market on Wednesday closed lower as investors awaited a decision overnight on interest rates from the US Federal Reserve, and the European Central Bank.
The benchmark S&P/ASX200 ended Tuesday down 30.9 points, or 0.51 per cent, at 6,023.5 points, while the broader All Ordinaries index was down 31.7 points, or 0.51 per cent, at 6,133.1 points.

US Markets

US stocks have ended a choppy session lower after the Federal Reserve raised its interest rates as expected and projected a slightly faster pace of rate hikes in the coming months.
Two additional lifts are now expected by the end of 2018, compared to one previously.
In its decision on Wednesday, the Fed raised its benchmark overnight lending rate a quarter of a percentage point to a range of between 1.75 per cent and 2 per cent.
The losses came on a day Wall Street had opened slightly in the black, after a court approved AT&T’s $US85-billion ($A112.2 billion) takeover of Time Warner after the closing bell on Tuesday.
Time Warner shares jumped 1.73 per cent after approval of the AT&T deal, which is expected to trigger other corporate takeovers, and AT&T dropped 2.13 per cent.
The Dow Jones Industrial Average fell 117.74 points, or 0.46 per cent, to 25,202.99, the S&P 500 lost 11.19 points, or 0.40 per cent, to 2,775.66 and the Nasdaq Composite dropped 8.10 points, or 0.11 per cent, to 7,695.70.

Commodities

The spot price of gold in Sydney at 0700 AEST was $US1,299.07 per fine ounce, from $US1,294.67 per fine ounce on Wednesday.
IRON ORE: $65.67 +0.03(July contract)

Oil Futures

Oil prices bounced to the highest close this month as strong U.S. demand ate into crude and fuel inventories.

Forex

The dollar fell Wednesday, as investors weighed a more hawkish Federal Reserve against uncertainties over global trade.
The WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, was recently down 0.1% to 87.15.
In a statement, the Fed said it will raise interest rates by another quarter-percentage point and signaled it could lift them at a faster clip this year. Expectations of higher rates tend to make the dollar more attractive to yield-seeking investors. Wednesday’s increase, the second this year, will bring the benchmark federal-funds rate to a range between 1.75% and 2%.

European Markets

The FTSE 100 ended flat on Wednesday as a weaker pound supported export-oriented shares, helping offset a fall in Just Eat on fresh competition worries and weaker energy stocks.
The index fluctuated within a tight range as investors waited for a string of central bank decisions this week, starting with the US Federal Reserve later in the day.
Just Eat fell 4.7 per cent, leading fallers on the FTSE, after Deliveroo stepped up competition against its rival, saying it would allow restaurants to use their own riders for orders placed through its app.
The FTSE finished where it started at 7,703.71.
Trading in European shares was hesitant as investors awaited guidance from the Federal Reserve on future US interest rate rises, while Inditex rose after results and Just Eat was bruised by intensifying competition.
Benchmarks barely budged, with all the action at the stock level. The pan-European STOXX 600 ended up 0.2 per cent while Germany’s DAX added 0.38 per cent to close at 12,890.58.

Asian Markets

Japanese stocks edged higher on Wednesday but gains were limited as many investors awaited the US Federal Reserve’s policy decision later in the day, while Toshiba jumped after announcing a major share buyback.
Toshiba Corp surged 6.7 per cent after saying it would buy back up to about 700 billion yen ($A144 billion) of its shares.
The Nikkei 225 ended 0.38 per cent higher at 22,966.38.
Investors turned attention from Tuesday’s US-North Korea summit in Singapore to the Fed’s coming decision and statement.
Hong Kong stocks ended lower as a slump in shares of telecommunications giant ZTE Corp unnerved market participants, while investors braced for the Fed’s policy decision later in the day.
The trade frictions between the United States and China have resurfaced ahead of Friday, by when Washington is expected to release a list of about $US50 billion worth of Chinese goods that will be subject to a 25 per cent tariff.
The Hang Seng index closed down 1.22 per cent at 30,725.15, while the China Enterprises Index ended down 1.4 per cent at 12,035.63 points.
China stocks also ended lower, on nervousness over ZTE Corp.
The blue-chip CSI300 index ended 0.98 per cent lower at 3,788.34 points, while the Shanghai Composite Index closed down 0.97 per cent at 3,049.80 points.
New Zealand’s S&P/NZX 50 index rose 0.21 per cent to 8,977.31.

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