ASX set to open lower on disappointing US retail data

Stock Markets

Australian shares set are open lower today on disappointing US retail data which heightened concerns about the outlook of the US economy. Wall Street’s main benchmarks opened sharply lower, before paring most losses following the release of disappointing US retail sales data for December which indicated a 1.2% plunge in retail sales. These results came as a shock to economists who expected a 0.2% gain, triggering new fears of recession. The Dow Jones and S&P 500 were down overnight, with the indices losing 103.88 (-0.41%), 7.30 (-0.27%) points respectively. The NASDAQ 100 was marginally up 6.54 (+0.09%) points. European stocks also slipped lower on Thursday as the market reacted to the US retail sales data. The pan-European Stoxx 600 ended down about 0.2% with most sectors closing in negative territory.

 China January trade data was better than expected and showed unexpected growth in China’s exports in January with imports falling less than expected.  January exports rose 9.1% from a year earlier, while economists expected a 3.2 percent drop. Imports fell 1.5 percent, which was much better than forecasts for a 10% drop.

ASX 200 futures are currently down 11.0 points. 

Today’s data releases: China PPI and CPI for January, Japan industrial production December, Euro zone trade balance December, UK retail sales January

Commodities and Currencies

Brent crude prices are currently up 1.01% to US$64.62 a barrel. The rally in oil prices continues, bolstered by US/China trade optimism and OPEC output cuts.

Iron ore prices were down 0.45% overnight and are currently sitting at US$88.08 per tonne.

The spot price of gold is currently up 0.03% and is now hovering around US$1312.62.

The AUD is currently marginally up 0.002% at US71.05¢. The Australian dollar rose briefly overnight after better-than-expected trade data from China.

This article was written by Mithun Fernando – Investment Analyst, Rivkin Securities Pty Ltd. Enquiries can be made via mithun.fernando@rivkin.com.au or by phoning +612 8302 3633.