Good morning traders. Thanks @ttward, @Ravgnome & the aftermarket loungers.
So much for Presidents Day. I don’t know about you’s, but more than a dozen states suing me probably makes for a poor start to the week.
ASX Market Report
Gains by Australia's big four banks have propped up the Australian sharemarket after a day of generally disappointingearningsresults.
The benchmark S&P/ASX200 index closed up 17.1 points, or 0.28 per cent, at 6,106.9 points at 1615 AEDT on Tuesday, while the broader All Ordinaries was up 13.5 points, or 0.35 per cent, at 6,184.2.
Between them the big four banks pushed the ASX200 higher by 17.24 points, meaning they were responsible for all of its gains.
The banks were led by ANZ, which was up 2.28 per cent to $27.35. Westpac, NAB and CBA gained between 0.99 and 1.65 per cent.
There was no macroeconomic lead-in from the United States, where markets were closed in honour of Washington's Birthday, so the day was dominated by earnings results - and they mostly left investors dissatisfied.
Of the 13 companies that reported results before the markets closed, all but four finished in the red.
Blackmores plummeted 24.85 per cent after the vitamin maker warned its sales in China were not expected to grow within the next six months.
Hearing implant company Cochlear was down 8.14 per cent after it said its growth in the US and Germany had slowed.
Coles was down 4.05 per cent after it reported first-half profit had slipped 29 per cent to $381 million in the wake of its spin-off from Wesfarmers.
Seven West Media was down 7.96 per cent after reporting half-year net profit fell 13.8 per cent amid lower advertising revenue.
Software-as-a-service company Citadel Group shares fell 12.21 per cent after it said its gross profit had fallen 0.6 per cent, to $23.3 million.
After the markets closed, BHP said its first-half profit fell 8 per cent because of production disruptions and a decline in commodity prices during the period.
Its underlying profit of $US4.03 billion ($A5.66b) missed consensus estimates of $US4.209 billion ($A5.91b).
The world's biggest miner declared an interim dividend of 55 US cents ($A0.77) per share, the same as last year.
The best news on the day came from IOOF, whose shares shot up 16.42 per cent, to $6.17, after the financial services company announced its underlying profit had increased 6 per cent, to $100.1 million.
Mount Gibson Iron, Monadelphous Group and Propertylink Group also finished in the green after reporting earnings, led by Monadelphous, which was up 4.2 per cent after the construction engineering company said it had secured $770 million of new contracts.
Twenty more companies are set to release earnings on Wednesday, and Michael McCarthy, chief market strategist with CMC Markets, said the results could be crucial.
"We need to see good results, otherwise we might see the market tip on market disappointment," he said.
The local currency spiked and then fell sharply before midday following the release of the RBA's monetary policy meeting minutes.
The Aussie dollar is buying 71.14 US cents, from 71.50 US cents on Monday.
ON THE ASX:
* The benchmark S&P/ASX200 index was up 17.1 points, or 0.28 per cent, at 6,106.9 points at 1630 AEDT on Monday.
* The All Ordinaries was up 13.5 points, or 0.22 per cent, at 6,184.2.
* At 1630 AEDT, the SPI200 futures index was up 4 point, or 0.07 per cent, at 6069.
CURRENCY SNAPSHOT AT 1630 AEDT:
One Australian dollar buys:
* 71.12 US cents, from 71.50 US on Monday
* 78.68 Japanese yen, from 79.04
* 62.97 euro cents, from 63.21
* 55.14 British pence, from 55.37
* 104.09 NZ cents, from 103.87
GOLD:
The spot price of gold in Sydney at 1630 AEDT was $US1323.60 per fine ounce, from $US1326.04 on Monday.
In Asia
Asian shares hovered near four-month highs on Tuesday as investors took heart from some progress in Sino-U.S. trade talks, while the yen slipped as the Japanese central bank said it won’t rule out further policy easing.
Japan’s Nikkei nudged up 0.2 percent after holding flat for most of the day. Australian shares climbed 0.3 percent to a 4-1/2 month peak, after gaining over 8 percent so far this year partly on expectations the central bank could ease policy to temper pressure on growth.
Chinese shares skidded into the red after surging in the previous session, with the blue-chip index off 0.4 percent.
That left MSCI’s broadest index of Asia-Pacific shares outside Japan down 0.1 percent, but still close to four-month highs reached last Wednesday.
Trade talks dominated headlines with a new round of negotiations between the United States and China expected in Washington on Tuesday, and follow-up sessions at a higher level later in the week.
Reflecting changing sentiment, Chinese shares have risen rapidly so far this month, with MSCI’s China A shares index up 6.5 percent, by far the best performance among major markets despite China’s weakening economy.
Additionally, investors are now seen returning to riskier asset markets after the U.S. Federal Reserve signaled earlier this year it could halt rate hikes in light of U.S. economic softness.
“In the last week, it seems like global central banks have started a possible process of monetary easing,” Bank of America-Merrill Lynch strategist Ajay Singh Kapur said in a note.
“If so, this would be very positive for Asia/EM stocks,” Kapur added.
In Europe
European shares slipped from four-month highs on Tuesday as anxiety over potential tariffs on European car imports to the U.S. dampened the optimistic mood over U.S.-China trade talks.
At 0940 GMT, the STOXX 600 was down 0.4 percent while Germany’s DAX held flat.
A new round of talks between the United States and China to resolve their trade war will take place in Washington on Tuesday. Sentiment is however fragile in Europe.
A confidential U.S. Commerce Department report sent to President Donald Trump over the weekend is widely expected to clear the way for him to threaten tariffs on imported autos, which would particularly hurt Germany.
“Europe could come more into focus in trade discussions going forward,” Goldman Sachs strategists wrote.
“This could add further challenges to both the autos sector and (Germany’s leading index) DAX in Europe, which have already underperformed materially”, they added.
The banking sector fell 1.5 percent, the worst-performing, while autos slid 0.5 percent.
Italy was a weak spot, falling 0.8 percent as bank stocks suffered from rising bond yields after weak industrial data.
In the United States
U.S. stocks inched higher on Tuesday, led by Amazon and upbeat earnings from Walmart, while investors focused on the latest round of trade talks between the United States and China.
Hopes that the two countries will hammer out a deal to end their protracted trade war have sparked a rally in stocks this year, keeping the main stock indexes at over two-month highs.
Shares of Amazon.com Inc gained 1.4 percent, providing the biggest boost to the S&P 500 and the Nasdaq.
Walmart jumped 3.9 percent after the world’s largest retailer reported an estimate-beating jump in holiday quarter comparable sales, helped by consumer spending in key categories like groceries and increased e-commerce purchases.
Trade-exposed industrial sector was little changed, with bellwether Boeing Co down 0.4 percent.
The consumer staples sector rose 0.76 percent, the most among the 11 major S&P sectors, helped by Walmart.
JPMorgan Chase & Co fell 1 percent and Goldman Sachs Group Inc dropped 0.6 percent, capping gains on the financial index, which was flat.
After the Federal Reserve announced its wait-and-see approach on interest rates this year, investors will look for more clues on monetary policy when the central bank releases the minutes from its January meeting on Wednesday.
At 12:42 p.m. ET the Dow Jones Industrial Average was up 29.63 points, or 0.11 percent, at 25,912.88, the S&P 500 was up 6.18 points, or 0.22 percent, at 2,781.78 and the Nasdaq Composite was up 23.57 points, or 0.32 percent, at 7,495.98.
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Got half an eye on Cyclone Oma later this week, might have to make the most of some nice weather.
