The share market hit a new five-week low this morning as a rebound in iron ore miners failed to arrest a ninth decline from the last ten sessions.
At lunchtime the ASX 200 was nine points or 0.2% lower at 5464 after earlier touching its weakest level since August 11. Advances in the metals and mining sector +0.4% and materials +0.3% were balanced by declines in consumer discretionary stocks -0.7%, telecoms -0.6%, industrials -0.3% and financials -0.1%.
The mood on Asian markets was subdued ahead of the US Federal Reserve's two-day policy meeting. China's Shanghai Composite eased 0.71% and Japan's Nikkei 0.33%. Trade on Hong Kong's Hang Seng was suspended for the morning as a typhoon disrupted transport. Dow futures were recently up one point or less than 0.1%.
“The big issue is whether the Fed will change its forward guidance to indicate they are getting closer to the decision on putting interest rates up,” Stephen Halmarick, head of investment markets research at Colonial First State Global Asset Management, told Bloomberg. “The transition period as the Fed tightens will be difficult for markets in the Asian region. I think we are in for a few months of increased volatility in markets.”
The dollar continued to recover this morning despite a warning from the Reserve Bank that the currency remains over-valued and rising house prices "warranted ongoing close observation". The dollar was lately buying 90.43 US cents.
Crude oil futures gave back 12 cents this morning at US$92.80 a barrel. Spot gold was $3 firmer at US$1,236.80 an ounce.
Market opened yet? Slowest morning I can recall in some time. Trades? Precious few. Volumes seem to be at Christmas levels in most of the specs I am watching. Should have got something out of the mid-rally pullback in SBM but hesitated and missed the boat. Eventually had a dab at TFC under $2 but got stiffed with a part-fill. It's fascinating that the central premise for many trading algorithms seems to be that if a trader is willing to pay $x for a share, he/she will be willing to pay $x+1c. I can't be the only trader who generally won't?
