A downturn in commodity prices and heavy falls in cryptocurrencies unsettled global markets and helped push the ASX to its lowest level this year.
The ASX 200 slid 35 points or 0.6% to 6013, giving up the last gains of the New Year rally en route to a one-month low. Declines in iron ore and base metals contributed to losses of 2% in metals & mining stocks and 1.8% in materials. Overnight, copper recorded its weakest price on the London Metal Exchange since before Christmas.
The night session also saw carnage among cryptocurrencies, with Bitcoin briefly losing 28% of its value on one exchange, Ethereum 30% and Ripple 46%. Read more here. The wild sell-off undermined a strong open for US equities, with the Dow suffering its biggest reversal since February 2016. After topping 26,000 for the first time, the Dow reversed almost 300 points to end the session 10 points or 0.04% weaker at 25,793. A post-close recovery saw Dow futures recently ahead 49 points or 0.2%.
Asian markets were mixed. While China's Shanghai Composite put on 0.52%, Hong Kong's Hang Seng lost 0.56% and Japan's Nikkei 0.45%.
Crude oil futures rebounded 15 cents or 0.24% this morning to US$63.88 a barrel. Gold futures improved $5.50 or 0.41% to US$1,342.60 an ounce. The dollar was buying 79.88 US cents.
We've reached an interesting moment in this long global bull market. Some markets are looking toppy. Wall Street opening 1% higher and finishing in the red is not normal. Nor is what happened in cryptos overnight. Cracks in the wall. Interesting that the XJO seems to have been pre-empting a pullback for more than a week now. Already through one support level and set to test 6000? Looks like money flowing back into gold. Trading: scrappy session. Traded HNR pretty well for two wins and one brokerage. Slim gain in OOK. Settled for brokerage in BLT. Report card: B-.
