Good morning traders. Thanks @ttward, @Ravgnome & the aftermarket loungers. Well what a wild day, then a wild night for the markets as the US market recovered a large portion their early losses. The RBA's rate decision later on this afternoon is today's big-ticket item.

ASX Market Report

Two tweets by Donald Trump have tanked the local bourse - along with markets around the globe - as investors worried the US-China trade war might not be so close to resolution after all.

The benchmark S&P/ASX200 index closed down 52.1 points, or 0.72 per cent, to 6,283.7 points at 1615 AEST on Monday, while the broader All Ordinaries was down 57.3 points, or 0.89 per cent, to 6,369.9.

The markets tumbled after Trump warned China not to take too hard a line on trade talks, tweeting that the US tariffs on China had helped the US economy and noting that they are scheduled to increase on Friday. "The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!"

"It was taken as a pretty clear signal to sell," said IG analyst Kyle Rodda in Sydney. "Anything tied to risk and growth has been belted. It's pretty much defined the whole day's trade." The Wall Street Journal cited a source saying China was considering walking away from the trade talks with the US after the tweets. Every sector was in the red aside from utilities, which were up slightly, 0.22 per cent.

Tech shares led losses, dropping 1.88 per cent collectively, with Wisetech Global down 5.13 per cent to $22 and Appen down 4.63 per cent to $24.31.

Westpac shares dropped 1.2 per cent to $27.11 after the bank's first-half profit slumped 22 per cent on customer remediation, restructuring costs and a weak property market. The other big banks did better, wtih NAB up 0.97 per cent to $25.92 and ANZ up 0.51 per cent to $27.55. Commonwealth Bank gained four cents to $74.94. Macquarie Group dropped 2.48 per cent to $125.62.

In the mining sector, BHP dropped 0.38 per cent to $36.80 and Fortescue Metals dropped 2.05 per cent to $7.15.

CIMIC Group shares plunged more than seven per cent after a scathing report by a Hong Kong firm, GMT Research, accused it of inflating profits by up to $1 billion. CIMIC, Australia's largest construction company, said its annual reports "are fully audited and in compliance with the accounting standards". CIMIC was the largest decliner among the ASX200, with its shares closing down $3.54 to $46.50, a two-month low.

Some gold miners gained from the general uncertainty, with Northern Star adding 0.49 per cent to $8.21 and Evolution Mining gaining 0.65 per cent to $3.09.

Pharma giant CSL fell 0.49 per cent to $198.90 while medical supplier ResMed slid 1.54 per cent to $16.01.

Retail Food Group was down 8.89 per cent after it acknowledged extending use-by dates on food products. Bubs Australia jumped 11.32 per cent after the company announced a partnership with Fonterra Australia to produce a new line of organic infant formula.

The Aussie dollar is buying 69.91 US cents, from 69.95 US cents on Friday.

The Reserve Bank of Australia will announce on Tuesday whether it will cut interest rates, with traders forecasting there's about a 50-50 chance it will do so. "It's going to be volatile," Mr Rodda warned, referring to currency fluctuations expected with the RBA decision.

ON THE ASX:

* The benchmark S&P/ASX200 index was down 52.1 points, or 0.82 per cent, to 6,283.7 points at 1630 AEDT on Monday.

* The All Ordinaries was down 57.3 points, or 0.89 per cent, to 6,369.9.

* At 1630 AEDT, the SPI200 futures index was up 47 points, or 0.76 per cent, to 6,210.

CURRENCY SNAPSHOT AT 1630 AEDT:

One Australian dollar buys:

* 69.91 US cents, from 69.76 US on Friday

* 77.43 Japanese yen, from 77.16

* 62.46 euro cents, from 62.41

* 53.29 British pence, from 53.04

* 105.52 NZ cents, from 105.52

Global Markets Report

Wall Street’s indexes and bond yields ended down but well above their session lows while oil futures settled higher as investors bet that U.S. President Donald Trump’s threats to raise tariffs on China would not materialize.

Trump tweeted on Sunday that the United States would raise tariffs on $200 billion worth of Chinese goods this week, causing investors to seek safety and flee from risky assets. On Monday, Trump sharply criticized China. But as Monday’s session wore on, the initial shock from the threats appeared to wear off. U.S. Treasury yields pared some of their declines.

Oil futures reversed course to settle slightly higher after a volatile day as rising tensions between the United States and Iran helped buoy prices. The futures had earlier touched a one-month low due to Trump’s tweets. In stocks, the S&P 500 closed down 0.4% after falling as much as 1.6% during the session.

“Investors are warming up to the idea that its more of a negotiation tactic than it is a petulant child screaming bloody murder,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. Fears about trade war escalation were also calmed somewhat by a statement from China’s foreign ministry on Monday that a Chinese delegation was still preparing to go to United States for trade talks. “Right now the contingent from China is still coming. If that changes, then the market narrative and the market reaction might also change,” said Nolte.

The Dow Jones Industrial Average fell 66.47 points, or 0.25%, to 26,438.48, the S&P 500 lost 13.17 points, or 0.45%, to 2,932.47 and the Nasdaq Composite dropped 40.71 points, or 0.5%, to 8,123.29. The pan-European STOXX 600 index lost 0.88% and MSCI’s gauge of stocks across the globe shed 0.65%. In comparison, the Shanghai SE Composite had closed up 5.6% in its biggest one-day percentage drop since February 2016.

BOND PRICES, OIL FUTURES RISE

The U.S. dollar slipped to a five-week low against the yen and fell versus other currencies on Monday after Trump said he would sharply raise tariffs on Chinese goods this week, risking the derailment of the trade talks between Washington and Beijing. Volume, though, was thin overall with London and Tokyo markets closed for holidays.

The dollar weakened 0.30% versus the yen to 110.89 per dollar. The dollar index rose 0.01%, with the euro unchanged at $1.12. Benchmark 10-year Treasury notes last rose 9/32 in price to yield 2.4998%, from 2.53% late on Friday.

U.S. West Texas Intermediate (WTI) crude futures settled up 31 cents, or 0.5%, at $62.25 a barrel. Brent crude futures settled up 39 cents, or 0.55%, at $71.24 a barrel.

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