Wall St fell overnight and the ASX is likely to follow suit in morning trading.
ASX SPI 200 futures are trading 0.6% lower to 7339 as of 8.25am AEDT.
Here’s what we saw:
- The Aussie dollar fell from highs near US71.75 cents to lows near US71.10 cents and was near US71.30 cents at the US close.
- Global oil prices fell on Monday on worries that rising global coronavirus cases could reduce crude demand.
- OPEC increased its outlook for oil consumption in the March quarter of 2022 to 1.1 million barrels a day.
- The Brent crude price fell by US76 cents or 1% to US$74.39 a barrel.
- The US Nymex crude price lost US38 cents or 0.5% to US$71.29 a barrel.
- Base metal prices were mixed as investors weighed the potential for more stimulus in China against an increase in inventories.
- Aluminium lifted 2.1%.
- Copper fell 0.8%.
- Tin down 2.1%.
- Gold futures price rose by US$3.50 or 0.2% to US$1,788.30 an ounce.
- Spot gold was trading near US$1,787 an ounce at the US close.
- Iron ore lifted US$7.60 or 7.4% to US$110.20 a tonne on expectations that China will move to increase fiscal stimulus next year.
Australian markets
The ASX 200 closed up 0.35% on Monday led by energy, materials and real estate.
Healthcare and financials dragged the bourse down.
That trend is unlikely to continue this morning, with the ASX likely to be in the red following a fall in all Wall St indices.
One company that could jump the gun today is Afterpay Group Ltd.
Afterpay shareholders to vote on merger
Afterpay Ltd (ASX:APT) shareholders will today vote on the Square merger. Note Square recently changed its name to Block.
Shareholders will vote to approve the buy now pay later company's $39 billion merger with Jack Dorsey's US payments giant.
The vote was pushed back by a delay in approval from the Bank of Spain, which enables Afterpay to service customers in Europe. While that approval is still pending, Afterpay has amended the scheme to enable the merger to proceed as long as the bank approves by April 14, 2022.
"Since our first meetings with the Block team, we’ve known that we share a vision of financial empowerment. And while we’ve been limited in the extent that we can bring our companies physically together since announcing the transaction, I’ve been proud to see how the teams of both companies plan to design, optimise and integrate post-completion," co-CEO Anthony Eisen will tell shareholders.
"We’ve built a phenomenal movement that’s attracted some of the world’s leading talent across all facets of our business. And it makes me very proud to think that with the support of our shareholders, this team will be joining forces with Block and seizing a new and powerful opportunity."
With close to 200 million proxy votes received, approval looks all but sealed with 99.79% of those votes in favour of the deal.
Approval will lead to completion of the merger in Q1 of 2022.
CSL finalising $1 billion acquisition
CSL Limited (ASX:CSL) is expected to finalise a $US12 billion ($16.74 billion) deal to acquire Swiss firm Vifor Pharma today.
Vifor is a global leader in nephrology, an area that covers kidney disease, and provides treatment drugs for dialysis and iron deficiencies.
Vifor currently turns over CHF1.7 billion ($2.6 billion) in a market in which millions of dialysis appointments are made each week across the globe.
Moderna’s $2 billion deal
Global pharmaceutical giant Moderna will help Australia become the largest producer of mRNA vaccines outside the US and Europe.
The $2 billion-plus deal will see a plant built in Melbourne capable of producing 100 million respiratory vaccines a year.
This includes COVID-19 booster shots.
This will be a three-way partnership between the federal government, the Victorian government and Moderna.
Melbourne will become the region’s main respiratory vaccine producer for future potential pandemics and seasonal flu.
Nearmap Ltd (ASX:NEA) continues US growth
By the end of the month, Nearmap’s North American annualised contract value will have surpassed its Australia and New Zealand portfolio.
The aerial imaging giant’s ACV portfolio has surpassed $US50 million ($70 million) while the group ACV is $US100 million ($140 million).
"This historical milestone for Nearmap follows the very positive momentum we're seeing in our business in North America," managing director and CEO Dr Rob Newman said.
"We purposefully refined our go-to-market strategy in the region at the beginning of FY21 to focus on three core industries: government, insurance and roofing.
"Since that time, we have delivered consecutive record half-year results.
"We're also seeing this momentum continuing into FY22, which validates our strategy and our execution."
Nearmap last traded at $1.47.
US markets
US stocks were lower yesterday as central bank decisions on interest rates loom.
“The heightened volatility and investor hesitation are understandable. After all, it’s going to be a massive week for global monetary policy, with some 20 central banks set to decide on interest rates and stimulus programmes,” ThinkMarkets analyst Fawad Razaqzada said.
The Federal Reserve, Bank of Japan, Bank of England and European Central Bank will meet this week.
While Omicron could impact decisions, the likelihood of faster tapering grows stronger by the day.
The US is expected to raise rates two times in 2022.
Person of the Year
Tesla CEO Elon Musk has been named Time Magazine’s 'Person of the Year' for 2021.
Tesla became the most valuable carmaker in the world, while SpaceX took passengers to the edge of space.
Time has called Musk “the man who aspires to save our planet and get us a new one to inhabit”.
Time’s editor in chief Edward Felsenthal wrote “few individuals have had more influence than Musk on life on Earth, and potentially life off Earth too.
“In 2021, Musk emerged not just as the world’s richest person but also as perhaps the richest example of a massive shift in our society.”
European markets
Europe was also in the red yesterday, for much the same reasons as the US.
Prime Minister Boris Johnson confirmed the UK’s first Omicron death and he now wants to give all UK adults a booster jab by the new year.
However, the UK PM has been accused by airlines of a “haphazard and disproportionate approach” to travel restrictions in the wake of Omicron.
“The new restrictions that are due to start this week is prompting further weakness in the likes of airlines with IAG, easyJet, Ryanair and Wizz Air all sharply lower,” CMC Markets analyst Michael Hewson said.
Meanwhile, oil prices slipped.
“It looks like COVID is once again the culprit as the rapidly spreading Omicron variant raises serious concerns over demand for crude oil as countries go back in partial or full lockdown,” ThinkMarkets’ Razaqzada said.
Overall, travel stocks dropped 2.6% on fears restrictions.
Despite the uncertainty, Deutsche Bank and Jefferies strategists are bullish about Europe next year, believing Europe could outperform the US.
“The macrocycle in Europe is well behind the US, and offers more upside risk,” Deutsche Bank strategists led by Binky Chadha wrote in a note dated Friday.
The bank has forecast a 15% return for the Stoxx 600 index next year compared with 12% for the S&P 500 index.