Thanks @Quantum Torus@Ravgnome and AM Loungers. Last trading week before Christmas. Hoping for some festive cheer in te ASX.
The Australian share market lost more than one per cent, with financial stocks weighing heavily as renewed fears about a global growth slowdown gripped investors pessimistic about dour economic data from China.
The benchmark S&P/ASX200 index was down 59.6 points, or 1.05 per cent, at 5602.0 at 1615 AEDT on Friday, while the broader All Ordinaries lost 0.99 per cent.
The slowing of retail sales and industrial production in China for November compounded investor sentiment still nervous about the wider impact of the unresolved trade dispute, CommSec market analyst James Tao said.
"It gave the impression that the Chinese economy is just not hitting the highs that it once was," he told AAP.
The Reserve Bank of New Zealand said it's considering almost doubling the required capital banks would need to hold to bolster the financial system's capacity to handle any shocks dragged financial stocks lower.
Shares in Australia's big four banks fell on the news as all operate within New Zealand.
ANZ suffered the biggest loss, down 2.7 per cent to $24.80, and NAB the least, losing 1.7 per cent to $23.69.
Energy shares were higher at the open but fell consistently through the day despite higher oil prices.
Santos and Oil Search, both down 2.3 per cent, dragged the indices lower, while Origin, Woodside and Caltex were between 0.7 and 1.4 per cent lower.
The miners also reversed earlier gains, with Fortescue down 2.1 per cent to $4.12, BHP lost 1.3 per cent to $32.40, and Rio Tinto was 1.5 per cent weaker at $74.57.
South32, however, rose 0.9 per cent to $3.28.
Shares in Nine Entertainment plummeted nearly nine per cent after major investor Deutsche Bank halved its stake in the newly merged media giant, while fellow telco TPG lost ground again.
It was down 2.3 per cent to $6.30 the day after the competition watchdog raised concerns about its planned merger with Vodafone Australia.
The healthcare sector was lower despite a dramatic jump from Sigma, up 43.2 per cent to 58 cents.
Drug distributor Australian Pharmaceutical Industries - up 8.5 per cent - offered about $727 million to buy Sigma, aiming to consolidate in the face of increased competitive and regulatory pressures.
The utilities and property trusts sectors were the only two to eke out gains.
The Australian dollar lost momentum on the economic data from China and was buying 71.93 US cents at 1630 AEDT, from 72.29 US cents cents on Thursday.
ON THE ASX:
* The benchmark S&P/ASX200 index was down 59.6 points, or 1.05 per cent, at 5602.0
* The All Ordinaries was down 56.5 points, or 0.99 per cent, at 5678.8
* At 1630 AEDT, the SPI200 futures index was down 36 points, or 0.64 per cent, at 5612
CURRENCY SNAPSHOT AT 1630 AEDT:
One Australian dollar buys:
* 71.93 US cents, from 72.29 US cents on Thursday
* 81.63 Japanese yen, from 82.03
* 63.31 euro cents, from 63.61
* 56.95 British pence, from 57.30
* 105.81 NZ cents, from 105.32
GOLD:
The spot price of gold in Sydney at 1630 AEDT was $US1241.2 per fine ounce, from $US1244.7 on Thursday.
Wall Street’s three major indexes tumbled on Friday and the Dow confirmed a correction as weak data from China and Europe stoked fears of a global economic slowdown, while Johnson & Johnson shares were the biggest drag after Reuters reported the company knew for decades that its Baby Powder contained asbestos.
The S&P 600 .SPCY small cap index confirmed it was in a bear market after closing 20.05 percent below its Aug. 31 peak, falling 1.6 percent on the day.
The Johnson & Johnson (JNJ.N) report, which the company has disputed, sent its shares tumbling 10 percent in heavy volume, making it the biggest weight from a single stock on the S&P 500 and the Dow Industrials.
Investors focused on global growth concerns and worried about U.S. growth after China reported weak monthly retail sales growth and industrial output numbers, as disappointing economic data was released from the euro zone.
“Weakness showing through in the Chinese economy in terms of the numbers that were reported as a result of the ongoing trade war was certainly a concern that bleeds into global growth concerns,” said Ryan Larson, head of U.S. equity trading at RBC Global Asset Management in Chicago.
Larson also pointed to concerns about a Reuters poll of economists which found the risk of a U.S. recession in the next two years rose to 40 percent and found a significant shift in expectations toward fewer 2019 Federal Reserve interest rate rises.
The Dow Jones Industrial Average .DJI fell 496.87 points, or 2.02 percent, to 24,100.51, 10 percent below its Oct. 3 closing high.
The S&P 500 .SPX lost 50.59 points, or 1.91 percent, to 2,599.95, 11.3 percent lower than its Sept. 20 record close, marking the poorest performance for the benchmark since it fell more than 14 percent between May 2015 and January 2016.
And with Friday’s close the losses inflicted by the correction are deeper than the declines suffered earlier this year.
The Nasdaq Composite .IXIC dropped 159.67 points, or 2.26 percent, to 6,910.67.
Johnson & Johnson helped pull down the S&P healthcare index .SPXHC 3.4 percent, making it the biggest percentage decliner among the S&P’s 11 major sectors. The technology index .SPLRCT, which includes a number of companies with global operations, especially China, dropped 2.5 percent.
The energy index .SPNY fell 2.4 percent.
Strong U.S. retail sales data appeared to have little impact on markets, with the S&P retail sector .SPXRT falling 2.4 percent.
“Solid fundamental data that gets to the core of the U.S. economy is overshadowed by the potential for a global slowdown washing up on our shores,” said Phil Blancato, chief executive of Ladenburg Thalmann Asset Management in New York but he said the sell off was buying opportunity.
The market struggled all week with choppy trading, on concerns ranging from U.S.-China trade talks, interest rates and a flattening U.S. Treasury yield curve and the shape of Brexit.
For the week, the S&P fell 1.25 percent and the Dow lost 1.2 percent while the Nasdaq shed 0.84 percent.
Investors appeared to shrug off Beijing’s announcement it would suspend additional tariffs on U.S.-made vehicles and auto parts for three months starting Jan. 1.
Amazon.com (AMZN.O) was the S&P’s second biggest drag with a 4 percent drop. Another highflyer, Apple Inc (AAPL.O), fell 3.2 percent, with reports citing a top analyst slashing iPhone sales estimates for the decline.
Costco Wholesale Corp (COST.O) dropped 8.5 percent after reporting a fall in quarterly gross margin and was the biggest laggard in consumer staples.
Declining issues outnumbered advancing ones on the NYSE by a 3.61-to-1 ratio; on Nasdaq, a 3.17-to-1 ratio favored decliners.
The S&P 500 posted nine new 52-week highs and 85 new lows; the Nasdaq Composite recorded six new highs and 425 new lows.
On U.S. exchanges 7.89 billion shares changed hands compared with the 7.97 billion-share average for the last 20 sessions.
The Australian share market is set to start the trading week lower, following Friday's heavy losses on Wall Street but experts are hopeful a "Santa Claus rally" will push it back up going into Christmas.
Ongoing worries about the global economy have so far kept markets flat in December thanks to the US-China trade war and dour economic data from China.
On Friday, the Dow Jones Industrial Average fell almost 500 points, or two per cent, the S&P 500 index lost 1.9 per cent and the tech-heavy NASDAQ fell 2.6 per cent.
AMP Capital's chief economist Shane Oliver says while the Australian market will open in the red on Monday, it may not experience the full extent of the drop felt in the US.
"That's possibly because we had an over one per cent fall on Friday, so to some degree we've already anticipated the fall on Wall Street," he told AAP on Sunday.
The futures market predicts that the benchmark S&P/ASX 200 will fall 0.6 per cent, or 30 points, lower when Australian trade resumes.
Despite the markets' disappointing start to December, Dr Oliver says there's hope the third week of December will bring with it the traditional "Santa Claus rally".
"People tend to feel happier going into Christmas and the end of the year, a lot of companies aren't raising capital anymore," he said.
"The last two weeks of December are usually fairly solid on share markets ... it will be interesting to see whether that so-called Santa rally gets through."
In other local news, the federal treasurer is expected to release the mid-year economic and fiscal outlook early this week.
Dr Oliver says he is expecting the figures to show a substantial improvement in budget projections.
Even factoring in upcoming election spending he says the figures indicate the government will have some scope to provide fiscal stimulus spending increases or tax cuts before Australians head to the polls.
The Reserve Bank of Australia will also release minutes from its board's monetary policy meeting for December on Tuesday.
The Australian dollar lost momentum on the economic data from China and was buying 71.93 US cents on Friday.
Source: Netwealth Morning Business Roundup
Getting you all prepared for the Silly Season with a healthy brekkie of Poached Eggs, Mushrooms, Tomato and Avo. Coffee for those who need it.
In consideration of others, PLEASE include the STOCK CODE in all your posts.
Happy trading, play nicely and make informed decisions.
