Wall St retreated and global markets sunk overnight pointing to a slow start on the ASX today.
Here's what happened.
- The SPI futures index was down 0.1% early this morning.
- The Australian dollar was lower at US72.40c.
- Iron ore was up 2.6% to $US153.35 a tonne.
- Brent oil was down 1.6% at $US71.07 a barrel with concern over crude demand taking its toll.
- Lead was down 1.0%.
- Tin was up by 0.9%.
- Nickel fell 2%.
- Spot gold was trading near US$1,792 an ounce at the US close.
Affecting the markets in the next 24 hours could be the US Federal Reserve's potential bond tapering plans as well as the arrival of personal income and spending, goods trade, inventories and consumer sentiment data.
Retail trade data will be issued in Australia and earnings season is ending with Wesfarmers Ltd (ASX:WES) the big report today. In China, industrial profits are scheduled.
Australian market
Crown Resorts Ltd will be hoping the appointment of ex Telstra and Optus CEO Ziggy Switkowski will help pull the company out of the hole it dug itself in, following money laundering allegations and the subsequent loss of its gaming licence.
Dr Switkowski will replace Helen Coonan, who steps down today after serving as a director of the James Packer-backed group for more than a decade.
Ms Coonan managed to convince NSW regulators that she was still fit to hold her position, however in Victoria counsel assisting the royal commission declared her unsuitable to run the state’s casino.
Dr Switkowski will need to rebuild Crown’s reputation. He said, “I look forward to joining the Crown board and working with board colleagues, CEO Steve McCann and Crown employees to grow value for shareholders by continuing the urgent work to reform the business.”
The other big news came out of the Wesfarmers camp, which joined the ranks of Australian companies raining down capital returns, dividends and special dividends on shareholders.
Wesfarmers announced a $2.3 billion capital return and a proposed return of capital to shareholders of $2 per share – subject to approval by Wesfarmers shareholders at the annual general meeting on October 21.
Chief financial officer Anthony Gianotti said, “The proposed return of capital is enabled by the strength of the group’s balance sheet, its access to well-established funding sources and the resilient and cash-generative nature of its businesses, as well as the receipt of proceeds from the sale of assets in recent years.”
This reporting season has seen several companies unveil tens of billions of dollars in special dividends and share buybacks.
Australian indices
- ASX 200 dropped 0.54% to 7,491.20
- ASX24 futures dipped 0.1% to 7,418
- S&P/ASX Small Ordinaries fell 0.55% to 3,529.80
- All ordinaries dipped 0.50% to 7,770.40
US markets
In the US the record-breaking run came to a halt, breaking a five-day winning streak, as markets wait to hear from Federal Reserve chair Jerome Powell and his comments on the central bank’s plans to pull back on its massive bond buying program.
The tragic double suicide bombing in Kabul that killed at least 12 US troops, also influenced the US markets.
“The devastating news coming out of Afghanistan is having an effect on the psychology of investors,” Art Hogan of National Securities told AFP.
While there were positive quarterly results, they weren’t enough to counter the downward trend. Salesforce.com jumped 2.7% and retailer Williams Sonoma surged 9.3%.
US indices
- Dow Jones fell 0.5% to 35,213.12
- S&P 500 dropped by 0.6% to 4,470
- Nasdaq fell 0.6% to 14,945.81
European markets
European markets closed lower on Thursday, led by mining shares which were down 1.5%.
In Europe, “tepid … trading has seen investors choosing to react to further weakness in Asian markets, as opposed to the further strength of Wall Street,” noted Interactive Investor analyst Richard Hunter.
London and Frankfurt stocks fell 0.4% and Paris shed 0.2%.
European indices
- STOXX 600 fell 0.32% to 470.34.
- German Dax fell 0.4% to 15,793.62.
- UK FTSE rose 0.3% to 7,124.98.