Wall St was mixed overnight and Asian markets also declined yesterday, pointing to a slow start for the ASX this morning.
As reported yesterday, Chinese government crackdowns hit the leisure sector hard.
Losses in casinos dragged the market down as did losses in the tech sector.
Hong Kong casinos are facing a new set of what could be very rigid rules, including having a government representative on their boards.
As such, trillions of dollars were wiped off the valuations of the six listed firms in reaction to the proposals.
The days when Macau raked in more in a day than Las Vegas, could now be over.
Sentiment in the region has also been affected by the spread of the Delta coronavirus variant and its impact on the economic rebound.
Just to be contrary, European stocks bucked the trend.
Heres’ what we know:
- The Australian dollar fell to below US73c to US72.93c.
- Iron ore tumbled 6.1% to $US106.50 a tonne.
- Brent oil rose 0.3% to $US75,67 a barrel
- Gold futures fell 2.1% to $US1756.70 an ounce.
- Spot gold was trading near US$1,753 an ounce at the US close.
- Nickel fell by 3.1% as concerns mount over demand from China's property sector amid a debt crisis at one of the country's top developers, Evergrande.
- Copper lost 2.7%
- Zinc was up 0.3%.
Australian markets
Foxtel is considering an IPO (initial public offering).
Whether that brings its pricing in line with streaming platforms such as Netflix remains to be seen, however, the content provider will face questions about what an IPO means at its September 30 strategy day.
The IPO has been touted following the company’s return to growth, which has pleased owners News Corp (NASDAQ:NWS) and Telstra.
Foxtel is known to have close ties with investment bank Citi, as well as Bank of America (NYSE:BAC), which will help with the listing should it go ahead.
It isn’t a bad time to list, although a listing date would be some time away, as streaming services have seen increased demand during lockdown.
Foxtel recently reported it has 2.1 million streaming customers, up 130% in the last 12 months.
Australian indices
- ASX 200 fell 0.18% to 7,423.80
- ASX24 futures fell 0.2% to 7,428
- S&P/ASX Small Ordinaries rose 0.042% to 3,540.40
- All Ordinaries rose 0.47% to 7,759.80
US markets
Wall Street’s mixed performance overnight came on the back of mixed economic data amid worries that COVID-19 and expected monetary policy shifts will have a negative impact.
Despite this, US retail sales posted a 0.7% rebound in August even though car sales declined.
US jobless claims for the week ended September 11 were 332,000. This was above analysts’ forecasts and 20,000 more than the week prior.
A US$3.5 trillion spending package financed by tax increases on corporations and the very wealthy has been touted by President Joe Biden as a measure to help the economic recovery, however, the prospects for the bill are uncertain due to Republican opposition to tax hikes and most of the spending.
Analysts continue to be concerned about the COVID-19 pandemic, supply chain problems exacerbating inflation and the Federal Reserve’s plan to scale back stimulus as soon as this year.
The market is “sort of in a tug of war right now", said Art Hogan, chief strategist at National Securities.
“Should we believe the concern we have over the slowing because of COVID-19, or should we believe the data over the last two days that shows some improvement in economic activity?”
US Indices
- Dow Jones fell 0.82to 34,751.32
- S&P 500 dropped 0.2% to 4,473.75
- Nasdaq rose 0.1% to 15,181.92
European markets
European stocks moved higher yesterday with London and Frankfurt both adding 0.2% and Paris increasing 0.6%.
“It’s been a slightly better day for markets in Europe, shrugging off a weak Asia handoff, with some decent gains for travel and leisure, which has enjoyed a respite after Ryanair announced it was increasing its 5-year growth target for passengers,” said analyst Michael Hewson at CMC Markets UK.”
European indices
- STOXX 600 rose 0.44% to 465.95
- German Dax rose 0.2% to 15,651.75
- UK FTSE rose 0.2% to 7,027.48