Australia Market extends losses for seventh day

Headline indices of the Australia market extended losses for the seventh consecutive session on Friday, 07 September 2018, as investors were in a defensive mode on following another mixed performance on Wall Street overnight on fears that President Trump could announce tariffs on $200 billion in Chinese imports as early as Friday after a public comment period on the administration's plan ended. Risk sentiments were also hurt by mounting concerns about contagion from a handful of struggling emerging economies. Most of ASX sectors declined, with shares of materials, energy, healthcare, tech, consumer staples, and consumer discretionary issues being notable losers. In late-afternoon trades, the benchmark S&P/ASX200 index was down 37.02 points, or 0.6%, at 6,123.40 points, while the broader All Ordinaries index declined 36.14 points, or 0.58%, at 6,231.70 points.

Turmoil in Argentina and Turkey, as their currencies continue to sink on deteriorating confidence, is dragging on the global market as investors fear a spillover effect on other healthier emerging markets and beyond.

 

On the trade front, the U.S. and Canada continued high-stakes negotiations in the effort to revamp the North American Free Trade Agreement, which President Donald Trump said he is prepared to move forward with even without Canada's participation.

Investors were also fretted about a possible escalation in the U.S.-China trade war later in the day, with President Donald Trump reportedly saying over the weekend that he is ready to impose tariffs on an additional $200 billion worth of Chinese imports as soon as the public comment period ends on Thursday.

Shares of materials and resources companies were mixed, with BHP Billiton fell almost 1% after its shares went ex-dividend for its 85c/share final dividend, while Fortescue Metals and Rio Tinto added in a range of 0.4% to 1%.

Shares of banks were mixed. Commonwealth Bank, National Australia Bank and ANZ Banking were down in a range of 0.1% to 0.3%, while Westpac was down 0.2%.

Shares of energy sector were lower after crude oil prices extended losses overnight after crude oil prices extended losses overnight. In energy space, Woodside Petroleum, Oil Search,and Santos fell in a range of 2% to 3%.

Among individual stocks, Domino's (DMP) rose almost 3% after the pizza maker released a statement addressing the Fair Work Ombudsman's investigation regarding the underpayment of workers. DMP said that 20 team members across 19 stores were underpaid by a total of A$2,000.

ECONOMIC NEWS: The latest survey from the Australian Industry Group revealed that the construction sector in Australia continued to expand in August, albeit at a slower pace, with a Performance of Construction Index score of 51.8. That's down from 52.0 in July, although it remains above the boom-or-bust line of 50 that separates expansion from contraction.

CURRENCY: Australian Dollar rose against greenback and other major currencies on Friday. The Aussie dollar was quoted at $0.7187, up from $0.7169 on Thursday.

OFFSHORE MARKET NEWS, US stock market closed softer for a third session on Thursday, on mounting concerns about contagion from a handful of struggling emerging economies on top of unresolved trade tension. The Dow Jones Industrial Average inched up 20.88 points or 0.1% to 25,995.87, the Nasdaq slumped 72.45 points or 0.9% to 7,922.73 and the S&P 500 fell 10.55 points or 0.4% at 2,878.05.

The major European stock markets ended down on Thursday. The French CAC 40 Index fell by 0.3%, the German DAX Index and the U.K.'s FTSE 100 Index slid by 0.7% and 0.9%, respectively.

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