Market participants are awaiting developments in the US-China trade conflict after the two countries said on Thursday, 16 August 2018, that they would hold lower-level trade talks next week. As per reports, the talks in Washington would take place on August 21 and 22, just before $16 billion in new US tariffs on Chinese goods take effect, along with an equal amount of retaliatory tariffs from Beijing. The US Trade Representative's office said on Friday it doubled the length of tariff hearings on the next $200 billion worth of Chinese goods to six days from the previously planned three due to overwhelming demand from companies to testify. The hearings will be held Aug. 20-24 and on Aug. 27.
Shares of material and energy companies were higher, following strength in base metal and crude oil prices on hopes trade talks between US and China could ease pressure on the sector. Among miners, Rio Tinto and BHP Billiton inclined in a range of 1-2%. Fortescue Metals shares gained almost 2% as it reported a 58% fall in full-year profit, but maintained its full-year production guidance. Among energy stocks, Woodside Petroleum inclined almost 1%, while Oil Search was down 0.2%. Origin Energy weakened as much as 8%, leading losses in the energy sector after underlying earnings of its energy markets business fell short of the its expectations.
Shares of financial players were mixed. Westpac and Commonwealth Bank declined in a range of 0.3-0.5%, while National Australia Bank and ANZ Banking inclined in a range of 0.1-0.5%.
Consumer staples were a drag with the major supermarkets both softer. Wesfarmers (WES) was down 1% as it trades ex-dividend and Woolworths (WOW) has slipped 1% after reporting that FY19 food sales have been slower due to the changes in plastic bag policies and increased competition. Over the previous financial year, WOW lifted net profit by 12% and revenue was a touch higher at A$57.2 billion.
INDIVIDUAL STOCKS: NIB Holdings shares declined more than 1% despite the company said its full-year profit rose 11%, aided by higher revenues and the acquisition of corporate health insurance provider GU Health.
Ansell shares declined more than 7% as the manufacturer of health and safety products reported net profit of US$484.3 million after selling its condom business during the year, but projected a mixed outlook for the new financial year.
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Woolworths shares declined more than 1% as the company reported a nearly 13% increase in full-year profit to A$1.7 billion, but said that supermarket sales in the new financial year have come under pressure due to the removal of single-use plastic bags.
CURRENCY NEWS: The Australian dollar was up against greenback and other major currencies, as appetite for commodity linked currencies underpinned on the likelihood of progress in trade talks between the US and major trading partners. The Australian dollar is buying 73.01 US cents in latest trading, up from 72.71 US cents on Friday.
OFFSHORE MARKET NEWS, US stock market closed higher on Friday, after reports that Chinese and U.S. negotiators are drawing up a road map for talks to try to end their trade impasse. The Dow Jones Industrial Average advanced 110.59 points or 0.4% to 25,669.32, the Nasdaq inched up 9.81 points or 0.1% to 7,816.33 and the S&P 500 rose 9.44 points or 0.3% to 2,850.13.
The major European markets also closed mixed on Friday. The U.K.'s FTSE 100 Index inched up by less than a tenth of a percent, the French CAC 40 Index and the German DAX Index edged down by 0.1% and 0.2%, respectively.
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