Global Market Report - 12 December
Australian shares are set to edge higher at the open as global markets clawed back ground in volatile overnight trade.
Australia
Australian shares are set to edge higher at the open as global markets clawed back ground in volatile overnight trade, and US President Donald Trump lifted tensions by threatening to shut down government over a funding fight with Democrats.
The SPI200 futures contract is up 16 points, or 0.29 per cent, to 5608.0, at 8am Sydney time on Wednesday, hinting the ASX will edge higher in early trade.
The Australian dollar is steady, buying 72.03 US cents, down only slightly from 72.04 US cents on Tuesday.
On Tuesday, mining and health care stocks lifted the Australian share market higher, but the gains did little to recover the big losses inflicted during Monday's trading. The benchmark S&P/ASX200 index was up 23.4 points, or 0.42 per cent, at 5575.9 at on Tuesday at the close, while the broader All Ordinaries rose 0.42 per cent.
Wall Street lifted overnight despite Trump's spat with the Democrats, with investor confidence lifted by a report that China is moving to cut import tariffs on American-made cars.
In late trade the Dow Jones Industrial Average was up 58.76 points, or 0.24 per cent, to 24,482.02, the S&P 500 gained 9.81 points, or 0.37 per cent, to 2647.53 and the Nasdaq Composite added 33.29 points, or 0.47 per cent, to 7053.81.
Oil prices rose overnight, as did most industrial metals, though iron ore dipped slightly.
In local finance news on Wednesday, Westpac will be the first of the big banks to face heightened shareholder angst, with the lender's annual general meeting in Perth a likely barometer for investor unhappiness following a harrowing year for the financial sector.
The Australian Bureau of Statistics is also due to release lending finance figures for October at 11.30am Sydney time.
ASIA
Despite the ongoing tensions following the arrest of Huawei executive Meng Wanzhou, Chinese markets notched meaningful gains in real estate and healthcare.
And investors held their breath on hopes of muted progress in US-China trade talks.
The Shanghai Composite Index added 0.4 per cent, or 9.51 points, to 2594.09 at the close.
In Hong Kong, stocks gained for the first time in five days. The Hang Seng Index climbed 0.1 per cent, or 19.29 points, to 25,771.67.
The offshore yuan gained as much as 0.3 per cent against the US dollar after China's commerce ministry said Vice-Premier Liu He had begun mapping out a trade timetable with US Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer.
Chinese developers rose on news that policies to cool the housing market would be eased.
RiseSun Real Estate Development rose by 7.3 per cent and Gemdale put on 4.1 per cent.
And Huadong Medicine was among the gainers in healthcare, rising 2.2 per cent, on news that a government pilot procurement program would have little effect on drug maker earnings.
EUROPE
European stocks charged higher, rebounding from the previous day's sharp downturn as bargain hunters, emboldened by solid US markets, pushed aside a plethora of global worries.
In Europe, London added 1.3 per cent and Frankfurt closed 1.5 per cent higher. Paris rose by nearly as much after President Emmanuel Macron made spending promises worth up to 11 billion euros ($12.5 billion) aimed at quelling the "yellow vest" unrest.
The British pound was back under pressure, having earlier enjoyed a modest rebound as
British Prime Minister Theresa May scrambled to rescue her Brexit deal.
The FTSE 100 top share index was up 1.3 per cent at the close with gains in mining stocks and big exporters helping it beat the domestically tilted FTSE 250 index, which rose 0.9 per cent after hitting two-year lows on Monday.
NORTH AMERICA
US stocks erased their early gains as investors weighed signs of progress in US-China trade talks amid gnawing concerns over prospects for growth.
The afternoon moves in the US marked the latest reversal for the stock market. Futures had rallied early in the day after President Trump said on Twitter that "very productive conversations" on trade. Shares of carmakers also rose after China agreed to reduce tariffs on US cars to 15 per cent, down from the current 40 per cent.
However, major indexes later fell into the red, exacerbated in part by a televised spat between Trump and top Democrats in which the President threatened to shut down the government if congress did not pay for his proposed border wall.
"If we don't get what we want one way or another, whether it's through you, through the military, through whatever you want to call, I will shut down the government," Trump told House Minority Leader Nancy Pelosi and Senate Minority Leader Chuck Schumer in the Oval Office as press and cameras watched on.
"I am proud to shut down the government for border security, Chuck."
Away from the White House, Apple shares lost 0.9 per cent as the company tried to get a Chinese court to reconsider its decision to ban sales of older iPhones in China. The court ruling added to the trade row tensions, as did the Meng arrest.
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