Good Morning Fellow Traders,
Australian shares have closed lower due to weakness from the major banks and investor caution over the US government shutdown.
The benchmark S&P/ASX200 index closed below the 6,000-point mark for the first time since mid-December, finishing 0.23 per cent lower at 5,991.9.
CMC Markets chief market strategist Michael McCarthy said the US government's temporary shutdown after a spending bill was voted down in the Senate was weighing on investors
"There is caution around the US government's shutdown," Mr McCarthy said.
"Essentially, we have seen a sell down in the banks today."
Commonwealth Bank shed 1.2 per cent to $78.85, Westpac fell 1.2 per cent to $30.57, ANZ was down 0.9 per cent at $28.30, and National Australia Bank declined 5.6 per cent to $29.00.
Real estate also dragged on the index as shares in property classifieds business Domain plunged 57 cents, or 17.2 per cent, to $2.75 after the surprise resignation of chief executive Antony Catalano just four months after the Fairfax spinoff listed on the ASX.
Realtor McGrath closed down 8.0 cents, or 13.8 per cent, at 50 cents after it said full-year
earnings before interest, tax, depreciation and amortisation would be between $5.8 million and $6.8 million - compared to a $16.6 million analyst forecast from last year.
McGrath chief executive Cameron Judson and all but one of the real estate firm's directors are leaving after the latest earnings warning, and the company shares are worth less than a quarter of their $2.10 price ahead of its December 2015 listing.
Australian Pharmaceutical Industries shares dropped 3.6 per cent to $1.475 after the company flagged a fall in first-half profit on the back of weak retail sales at its Priceline pharmacies before and during the Christmas trading season.
Meanwhile, the Australian dollar slipped against its US counterpart despite the greenback's weakness amid the government shutdown.
The local currency was trading at 79.94 US cents at 1700 AEDT on Monday, from 80.14 on Friday.
ON THE ASX:
* The benchmark S&P/ASX200 closed down 13.9 points, or 0.23 per cent, at 5,991.9 points
* The broader All Ordinaries index was down 13.1 points, or 0.21 per cent, at 6,106.2 points
* The SPI200 futures contract was down 10 points, or 0.17 per cent, at 5,940 points
* National turnover was 3 billion securities traded worth $3.6 billion.
CURRENCY SNAPSHOT AT 1700 AEDT:
One Australian dollar buys:
* 79.94 cents, from 80.14 on Friday
* 88.57 Japanese yen, from 88.87 yen
* 65.35 euro cents, from 65.37 euro cents
* 57.66 British pence, from 57.62 pence
* 109.80 NZ cents, from 109.79 cents
GOLD:
The spot price of gold in Sydney at 1700 AEDT was $US1,331.71 per fine ounce, from $US1,331.58 per fine ounce on Friday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 4.50 per cent April 2020, 2.1040pct, from 2.1071pct
* CGS 4.75pct April 2027, 2.8146pct, from 2.8191pct
Sydney Futures Exchange prices:
* March 2018 10-year bond futures contract at 97.135 (implying a yield of 2.865pct), from 97.125 (2.875pct) on Friday
* March 2018 3-year bond futures contract at 97.715 (2.285pct), unchanged.
(*Bond market closes taken at 1630 AEDT previous local session; currency closes taken from 1700 AEDT previous local session)
U.S. stocks advanced on Monday as each of Wall Street’s main indexes touched a record intraday level after U.S. senators struck a deal to end the federal government shutdown.
U.S. senators voted to move forward on legislation that would reopen the federal government until Feb. 8. Funding legislation cleared a procedural hurdle in the Senate and was expected to pass a full Senate vote promptly, allowing government to re-open.
“The only way politics affects what the market does is if they end of having a negative impact on the economy and corporate earnings and so far that hasn’t been the case,” said Michael Arone, Chief Investment Strategist at State Street Global Advisors in Boston.
“The market has been more than willing to ride the tailwind of better global growth and higher corporate earnings, not only in the U.S. but globally.”
Earnings growth of 12.4 percent is expected for the quarter, according to Thomson Reuters data. Of the 55 companies in the S&P 500 that have reported earnings through Monday morning, 80 percent have topped expectations, well above the 72 percent beat rate for the past four quarters.
The Dow Jones Industrial Average
.DJI rose 65.67 points, or 0.25 percent, to 26,137.39, the S&P 500
.SPX gained 13.41 points, or 0.48 percent, to 2,823.71 and the Nasdaq Composite
.IXIC added 48.93 points, or 0.67 percent, to 7,385.31.
Advancing issues outnumbered declining ones on the NYSE by a 1.38-to-1 ratio; on Nasdaq, a 1.10-to-1 ratio favored advancers.
The S&P 500 posted 107 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 181 new highs and 14 new lows.
Source: Netwealth Morning Business Roundup
A Vege Packed Omelette and Icy Peppermint Tea for your morning dining pleasure. Looks like pretty hot weather ahead in most of the capitals with Melbourne getting some reprieve.
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Should see some green again around the traps after a predominantly crimson day yesterday..
Happy trading, play nicely and make informed decisions.
