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Global Market Report - May 21, 2018

Lex Hall  |  21 May 2018Text size  Decrease  Increase  |  
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Australia

The easing of trade tensions between the US and China may help the Australian share market recover and move higher despite futures pointing to a lower opening.
US Treasury Secretary Steven Mnuchin says the Trump administration won’t apply tariffs on Chinese imports to the US while the two countries hammer out details of a deal to reduce the yawning US merchandise trade deficit with China.
Earlier, China’s agreement to boost imports from the US to close a trade gap between the two countries boosted hopes trade tensions could be resolved.
While the SPI futures index is this morning pointing to a 30-point fall at the open, AMP Capital chief economist Shane Oliver told AAP he expects a bounce on trade optimism. The Australian dollar was flat, buying 75.11 US cents.
The benchmark S&P/ASX200 index was down 6.9 points, or 0.11 per cent, at 6087.4 points at the close on Friday, while the broader All Ordinaries index fell 6.3 points, or 0.1 per cent, at 6190.9 points.
In the US, the Dow Jones Industrial Average finished essentially flat, up 1.11 points, while the S&P 500 was down 0.26 per cent and the Nasdaq Composite fell 0.38 per cent.
Out today: NZ retail sales volumes first quarter.

Asia

Asian stocks were steady on Friday amid caution over developments in US-China trade negotiations, while the dollar perched near a five-month peak after the benchmark US Treasury yield hit its highest in seven years.
MSCI’s broadest index of Asia-Pacific shares outside Japan was little changed, while Hong Kong’s Hang Seng rose 0.34 per cent and Shanghai climbed 1.24 per cent as some investors bet Beijing and Washington will reach a deal in the latest round of trade talks.
Japan’s Nikkei rose 0.4 per cent, and South Korea’s KOSPI was up 0.5 per cent.

Europe

Britain’s leading stock index posted its eighth straight week of gains despite dipping slightly on Friday as investor enthusiasm waned following the previous day’s record close.
The FTSE 100 ended the session down 0.1 per cent at 7778.79 points, in line with the FTSE 250 which hit a fresh record earlier in the session before turning lower.
The FTSE sealed its longest winning streak in 13 years, marking a strong comeback for British stocks.
Commodities, a key part of the UK stock market, have driven much of the recent climb in the FTSE 100, which has also benefited from a string of brokers recommending investors buy back into the region. The index made a full recovery from its February losses.
Oil stocks were mixed on Friday, however, having surged all week thanks to crude prices which breached the $80/barrel barrier on Thursday after a strong run.
Major Royal Dutch Shell fell 0.5 per cent, while BP edged 0.4 per cent higher.

North America

The S&P 500 ended lower on Friday after a choppy trading session as bank and chipmaker stocks weighed on the index and investors grappled with US-China trade talks.
All three major US stock indexes posted a weekly loss as the markets reacted to reports from the US-China trade summit, rising US government bond yields and increasing oil prices.
China denied accounts by some US officials that it had offered a package to slash the US trade deficit by up to $200 billion, but said the consultations were “constructive”, in the latest salvo of tit-for-tat messages to emerge from the high-level meeting.
Boeing Co shares rose on hopes for a reduction in the US-China trade deficit, after an American source said the company would be major beneficiary of a narrowed trade gap. Boeing sells about a fourth of its commercial aircraft to Chinese customers. The plane maker’s shares rose 2.1 per cent, helping keep the Dow Jones Industrial Average out of negative territory.

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Lex Hall is a Morningstar content editor, based in Sydney.

© 2018 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. This information is to be used for personal, non-commercial purposes only. No reproduction is permitted without the prior written consent of Morningstar. Any general advice or 'class service' have been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), or its Authorised Representatives, and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product's future performance. To obtain advice tailored to your situation, contact a licensed financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782 ("ASXO"). The article is current as at date of publication.

 

is content editor for Morningstar Australia

© 2020 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. This information is to be used for personal, non-commercial purposes only. No reproduction is permitted without the prior written consent of Morningstar. Any general advice or 'class service' have been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), or its Authorised Representatives, and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product's future performance. To obtain advice tailored to your situation, contact a licensed financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782. The article is current as at date of publication.

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