Day Trading Pre Open - 10 September 2018

Good Morning Fellow Traders,

Thanks @Quantum Torus, @Ravgnome and AM Loungers. All manner of chatter in the Lounge over the weekend - including health and fitness, gardening, dog care, sport. we met @babysteps' Mum and oh - there was some talk about trading and stocks.

The Australian sharemarket closed in the red for the seventh straight session and the dollar hit a fresh two-year low as fears of global contagion from emerging markets spread, but bargain hunters lifted the ASX off technical support.

The S&P-ASX 200 index fell to a one per cent low mid-session as China stocks reversed early gains, but it bounced off the 6100 point level as Shanghai closed for lunch and rallied to close down 16.6 points, or 0.27 per cent, at 6143.8 with healthcare and energy stocks leading losses.
The index was down 2.8 per cent for the week, up 1.2 per cent for the year to date, but in US dollar terms it is down 7 per cent for the year.

Commonwealth Bank was the only major lender to dodge the early selling as out-of-cycle mortgage rate increases stoked fears falls in east coast house prices could accelerate.
In July there was a 0.4 per cent rise in total home loans, but investor lending fell 1.3 per cent.
The MSCI emerging market index has now fallen into a bear-market 20 per cent correction as US-China trade-war fears and a tightening US dollar funding crunch continue to drive selling across the region.

Underscoring the extent of weakness, Hong Kong’s Hang Seng index is down 19 per cent since January as the Hong Kong monetary authority continues to intervene to support the HK dollar peg to the US dollar.
The Shanghai composite index was flat at the close of the ASX.

Following emerging-market weakness, the Australian dollar dropped US0.4¢ to a two-year low of US71.40¢, despite a strong headline GDP growth report this week.
Citigroup economist Paul Brennan said growth had been above trend but not all were “winners” as wage growth remained weak.

“Above trend growth, if sustained, could see a belated pick-up in wages towards 3 per cent next year,” he said. “Without this the squeeze on households’ financial positions could become a more binding constraint on the economic outlook.”

Government 10-year bond yields dropped 1.9 points to 2.54 per cent after US 10-years dropped 3 points to 2.87 per cent last night.

Wall Street’s major indexes fell on Friday as U.S. President Donald Trump raised the possibility of additional tariffs on Chinese imports and Apple Inc indicated that some of its products could be subjected to such levies.

U.S. stocks were lower for most of Friday’s session but dipped further in the last half-hour of trading on reports that Apple products, including the Apple Watch and AirPods, would be slapped with duties. Apple shares, which had been in positive territory for most of the session, ended 0.8 percent lower.

The company provided those details in response to the White House’s proposed tariffs on $200 billion worth of Chinese imports. A comment period for those tariffs ended on Thursday night. Earlier on Friday, White House economic adviser Larry Kudlow said Trump would not make any decisions on those tariffs until officials evaluated public comments.

“Apple is a bellwether name,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. “(That’s) why we may be seeing some profit-taking going into the weekend.”

U.S. stocks had already been pressured after Trump said he had tariffs ready to impose on an additional $267 billion worth of Chinese imports, on top of the proposed $200 billion.
The escalated trade rhetoric contributed to anxiety among investors regarding the market’s outlook.

“There’s the possibility of (China) devaluing its currency again, which pushes up the dollar and turns the pressure up on U.S. exporters,” Krosby said.

The Dow Jones Industrial Average fell 79.33 points, or 0.31 percent, to 25,916.54, the S&P 500 lost 6.37 points, or 0.22 percent, to 2,871.68 and the Nasdaq Composite dropped 20.19 points, or 0.25 percent, to 7,902.54.
For the week, the Dow lost 0.19 percent, the S&P fell 1.03 percent, and the Nasdaq shed 2.55 percent. The Nasdaq registered its greatest weekly percentage decline since late March, while the S&P’s weekly percentage drop was its biggest since late June.

The S&P and Dow had opened lower after the U.S. Labor Department’s employment report showed accelerating job growth and a surge in wage growth. Though the report indicated a strong economy, it raised concerns among investors regarding inflation and the Federal Reserve’s plans for increasing interest rates.

With the added pressures from trade concerns, 10 out of the S&P’s 11 major sectors ended lower. Only health care stocks posted gains.

Shares of chipmaker Broadcom Inc rose 7.7 percent after a strong current-quarter revenue forecast.

Tesla Inc shares slid 6.3 percent following reports of two executives leaving the company and on mounting investor concerns about Chief Executive Elon Musk’s behavior after he smoked marijuana on a live Web show.

Declining issues outnumbered advancing ones on the NYSE by a 2.21-to-1 ratio; on Nasdaq, a 1.24-to-1 ratio favored decliners.

Source: Netwealth Morning Business Roundup

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