Good Morning Fellow Traders,
Thanks @Ravgnome. Nice to have @paddington bear back with her market analysis. The new year has started with a whimper so it seems.
Weakness in the Chinese economy has caused the Australian share market to kick off 2019 back where it was at the end in 2018 - down in the dumps.
The benchmark S&P/ASX200 index dropped 88.6 points, or 1.57 per cent, in late afternoon trading to finish at 5557.80 at 1615 AEDT on Wednesday.
The broader All Ordinaries was down 83.8 points, or 1.47 per cent, to 5625.6.
After treading water in the morning, the ASX - along with the Aussie dollar - started falling shortly after noon with the release of data showing factory activity in China fell in December for the first time in over two years.
Losses on the ASX were across the board with the energy sector down 2.58 per cent, financials down 2.01 per cent and telecom services down 2.48 per cent.
The Aussie dollar dropped nearly 0.7 per cent to as low as 70.02 American cents - its lowest level in nearly three years - before recovering some of its losses.
"It really has been out with old, in the with the old," said James Tao, a market analyst with Commsec. "It's really not the way we wanted to start the new year."
ANZ was the worst of the big banks, trading down 60 cents, or 2.45 per cent, to $23.86.
Telstra was down 2.81 per cent, or 8 cents, to $2.77.
Starpharma Holdings lost 12.5 cents, or 10.55 per cent, to $1.06, despite news that its VivaGel condom had received regulatory approval in Japan. The condom contains a lubricant gel that kills HIV, the herpes virus and HPV.
The biggest company to have a good day was $3 billion gold mining company OceanaGold, which traded up 27 cents, or 5.56 per cent, to $5.13. But it was one of a very few in the green.
Ingham Group's shares were clipped 3.37 per cent, to $3.97, after the poultry producer said its chief financial officer was leaving in six months. It gave no reason for the resignation.
South32 was down 2.39 per cent, to $3.27, on news that its strategic partner AusQuest was abandoning two prospective drilling sites in Western Australia that hadn't panned out. AusQuest shares finished down 15.79 per cent, to 1.6 cents.
By shortly after 5pm the Aussie dollar had clawed back most its losses, trading at 70.37 American cents, or 0.23 per cent lower than Tuesday.
That's still nearly 5 per cent lower than where it was back on December 4, when one Australian dollar bought 73.875 US cents.
ON THE ASX:
* The benchmark S&P/ASX200 index was down 88.6 points, or 1.57 per cent to 5557.8
* The All Ordinaries was down 83.8 points, or 1.47 per cent, to 5625.6.
* At 1415 AEDT, the SPI200 futures index was up 12 points, or 0.22 per cent, at 5499.
CURRENCY SNAPSHOT AT 1415 AEDT:
One Australian dollar buys:
* 70.2 US cents, from 70.53 on Tuesday
* 76.804 Japanese yen, from 77.385
* 61.31 euro cents, from 61.52
* 55.12 British pence, unchanged from 55.32
* 1.0479 NZ cents, from 1.0496
GOLD:
The spot price of gold in Sydney at 1415 AEDT was $US1,283.86 per fine ounce, from $US1,282.25 on Tuesday.
US stocks have started the new year with a more than 1 per cent decline, as weak data in Asia and Europe confirmed fears of a global economic slowdown while the US government shutdown drags on.
All 11 major S&P sectors are lower in early trading on Wednesday, with declines in the technology and healthcare indexes weighing the most on the market.
All 30 of the Dow Industrial components were in the red.
China's factory activity contracted for the first time in 19 months in December, hit by the Sino-US trade war, with the weakness spilling over to other Asian economies.
Eurozone manufacturing activity dropped for the fifth month and barely avoided contraction.
The grim readings come ahead of the closely watched US manufacturing survey on Thursday, payrolls data on Friday and the US earnings season later this month, which is expected to show corporate profit shrunk in the October-December quarter.
"Increasing evidence of China's economy weakening further has sent chills throughout global markets. This fear has been a depressing factor for the markets," chief market economist at Spartan Capital Securities Peter Cardillo said in a client note.
At 9.56am local time the Dow Jones Industrial Average was down 259.33 points, or 1.11 per cent, at 23,068.13, the S&P 500 was down 27.61 points, or 1.1 per cent, at 2479.24 and the Nasdaq Composite was down 79.29 points, or 1.20 per cent, at 6555.98.
The tech index slipped 1.15 per cent, with Microsoft and Apple down nearly 2 per cent.
Amazon and Netflix fell over 1 per cent to drag the consumer discretionary sector down by 0.9 per cent.
Healthcare, 2018's best performing sector, dropped 1.61 per cent, while energy, last year's worst performing sector, fell 0.94 per cent as concerns about an economic slowdown also hit oil prices.
A low appetite for risk sparked demand for US Treasuries, sending yields on 10-year debt to a 12-month low of 2.647 per cent.
Meanwhile, the US Congress is set to reconvene with no signs of a workable plan to end a 12-day-old partial shutdown and Trump not budging on his demand for $US5 billion to fund a border wall.
A Democrat plan to approve a two-part spending package does not include these funds.
Tesla sank 8.6 per cent after the electric car maker delivered fewer-than-expected Model 3 sedans in the fourth quarter and cut prices for all its vehicles in the United States in response to the loss of a green tax credit.
Declining issues outnumbered advancers for a 4.22-to-1 ratio on the NYSE and a 2.43-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and three new lows, while the Nasdaq recorded three new highs and 44 new lows.
Source: 9Finance
Let's wrap up brekkie with these babies - Scrambled Egg, Tomato and Spinach. @paddington bear will be hanging out for a coffee no doubt.
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Happy trading, play nicely and make informed decisions.
