Good morning traders. Thanks @ttward, @Ravgnome & the aftermarket loungers. Volatility is definitely back with a vengeance this week.

ASX Market Report

The Australian share market has closed up slightly, having given up some of its gains following the Reserve Bank's decision to keep rates on hold for a record 33rd month. The Aussie dollar had the opposite reaction, spiking against the US dollar. It was buying 70.35 US cents, from 69.91 US cents on Monday.

The benchmark S&P/ASX200 index fell 30 points in the five minutes after the RBA's decision to close up 12 points, or 0.19 per cent, to 6295.7 points at 1615 AEST on Tuesday. The broader All Ordinaries was up 13.6 points, or 0.21 per cent, to 6,383.5.

The mining sector had strong gains, up 1.33 per cent collectively, after a court in Brazil ordered Vale to halt operations at its Bructu iron ore mining complex, reversing a lower court's decision to allow it to reopen. The company has been under intense scrutiny ever since a dam collapse at another one of its mines in Brazil killed hundreds of people in January. A prolonged closure of the mine could cause another crunch in the supply of iron ore.

Prices for low grade ore spiked in particular, and Fortescue Metals, which mostly produces it, gained 6.29 per cent to $7.60 - making it the biggest gainer on the ASX200. BHP gained 1.36 per cent to $37.30, South32 gained 1.82 per cent to $3.36 and Rio Tinto was up 2.25 per cent to $96.05.

The banking sector was down 0.27 per cent as a whole, with Commonwealth down 0.44 per cent to $74.61, Westpac down 0.18 per cent to $27.06, NAB down 0.31 per cent to $25.84 and ANZ down 0.18 per cent to $27.50.

GrainCorp was the biggest decliner on the ASX200, falling 6.96 per cent to $8.15 after Long-Term Asset Partners withdrew its takeover offer for the bulk grain handler.

Actinogen Medical crashed 68.75 per cent to 1.5 cents after the Sydney biotech company said two-year trial of its drug to treat Alzheimer's disease hadn't shown it worked any better than a placebo.

Landmark White shares dropped 26.32 per cent to 28 cents after they resumed trading from a near three-month suspension following a client data breach that cost the property valuation company at least $5 million in lost profit and led to the resignation of its CEO.

Blue Ocean equities analyst Mathan Somasundaram said that with the RBA decision out of the way, traders would next be looking to see if the US and China reach a resolution to their trade war this week or if the US hikes tariffs again, as it has threatened. "It's beginning to look at a lot like Brexit," he said, referring to the long drawn-out nature of the talks.

Global Markets Report

Equities and oil futures fell sharply on Tuesday, as investors worried U.S.-China negotiations were floundering and that an escalating trade war could damage global growth.

U.S. Treasury yields fell and the yen rose against the dollar as investors sought safe havens. Equities fell early and losses got steeper throughout a volatile session as investors bet that U.S. President Donald Trump’s weekend threat to hike tariffs on hundreds of billions of dollars of Chinese goods could materialize at the end of the week. U.S. Trade Representative Robert Lighthizer on Monday vowed to continue talks but said that as of now “come Friday there will be tariffs in place.”

After Lighthizer’s comments, many investors worried that Trump’s tariff threats were not just a negotiating tactic. “The signs of a potential breakdown in the talks are really what’s fueling the risk off trading,” said Peter Kenny, founder, Kenny’s Commentary LLC in New York. “What’s even more significant is not just that the talks appear to have hit a road block but the perception that China is trying to renegotiate key elements of the deal.” People are starting to price in the fact that trade negotiations may fall apart or at least extend,” said Chris Zaccarelli, Chief Investment Officer, Independent Advisor Alliance, Charlotte, NC. “There are people who tried to buy the dip but at the end of the day there’s more people raising cash because they’re worried.”

The Dow Jones Industrial Average fell 473.39 points, or 1.79%, to 25,965.09, the S&P 500 lost 48.42 points, or 1.7%, to 2,884.05 and the Nasdaq Composite dropped 159.53 points, or 1.96%, to 7,963.76. The S&P ended above its session low but registered its third biggest daily percentage drop of 2019. MSCI’s gauge of stocks across the globe shed 1.23%, while the pan-European STOXX 600 index lost 1.37%. Emerging market stocks lost 0.53%.

INVESTORS SEEK SAFETY

U.S. Treasury yields fell with longer-dated yields hitting five-week lows on safe-haven demand for bonds. Benchmark 10-year notes last rose 12/32 in price to yield 2.4566%, from 2.5% late on Monday.

“Without a trade deal and a round of tariffs, that will have impact on economic growth,” said Mary Ann Hurley, vice president of fixed income at D.A. Davidson in Seattle. “That’s positive for bonds.”

The U.S. dollar gained against a basket of currencies but weakened against the Japanese yen as foreign exchange traders also sought out safe-haven assets and placed bets on increasing currency volatility. The dollar index, tracking the greenback against six major peers, rose 0.05%, with the euro down 0.04% to $1.1192. The Japanese yen strengthened 0.45% versus the greenback at 110.29 per dollar. The offshore yuan had been on course for its worst daily drop in 10 months, briefly touching a four-month low of 6.8218, and it remained under pressure but recovered some ground. It was last down 0.38% at 6.797 yuan per dollar.

Oil prices closed at their lowest in over a month on concerns about global growth and expectations that U.S. crude stockpiles could hit 19-month highs. U.S. crude oil futures settle at $61.40 per barrel, down 85 cents, or 1.37% while Brent futures settled at $69.88, down $1.36, or 1.91%.

Please include the STOCK CODE in your post out of respect for your fellow traders, or use the OT (off topic) tag for non-stock related content.