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Markets Live: $A plummets on tariff risk
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Yesterday
Yesterday
Trade concerns have wiped close to $50 billion worth of market capitalisation from Australian stocks this week, with investors trading cautiously as the US threatened to impose more tariffs on China.
The S&P/ASX 200 index closed the week down 175.7 points, or 2.8 per cent, to 6143.8, the index's worst five-day performance since February.
Concerns that US President Donald Trump would further jeopardise the country's already tense relationship with China by imposing more tariffs on its exports shook global markets and commodities this week. The Bloomberg Commodity index fell by as much as 1.2 per cent this week, hurting local mining stocks.
BHP Billiton was one of the biggest weights on the market this week, due to the trade threats and weaker commodity prices. The miner also traded ex-dividend on Thursday, its shares falling 5.8 per cent to $31.30 this week.
Weakness in the US technology sector was felt on the Australian sharemarket this week. Facebook and Twitter chiefs appeared before the Senate Intelligence Committee this Wednesday, causing a sell-off of US tech stocks with fears that they could face increased regulatory pressure. This caused Australia tech stocks such as Appen, which counts eight of the top 10 tech giants including Apple, Facebook, and Google as clients, to fall.
Appen closed 10.4 per cent lower at $13.74 although it wasn't the worst performing IT stock this week. NEXTDC fell 15.8 per cent to $5.97, AfterpayTouch closed the week 17.3 per cent lower at $15.00 and Xero went down 9.4 per cent to $46.27.
ANZ and Commonwealth Bank raised their variable interest rates this week, blaming increasing funding costs for the move. ANZ announced on Thursday it would raise its variable home loan interest rates by 16 basis points and Commonwealth quickly followed suit, announcing it would increase its own rates by 15 basis points. The announcements came a week after Westpac raised its variable interest rates by 14 basis points and NAB is now the only one of the four majors yet to announce an increase.
ANZ shares closed the week 3.7 per cent lower at $28.40 while Commonwealth Bank shares closed at $70.51, down 1 per cent.
Northern Star Resources was the best performing stock on the index this week, rising 17.5 per cent to $8.18. The gold miner returned from a trading halt on Monday announcing it had successfully completed a placement to institutional investors, allowing it to fund its $US260 million acquisition of the Pogo gold mine in Alaska.
Yesterday
It was five days until the year's biggest auction was due to conclude and NSW Treasurer Dominic Perrottet and his team were confident that a $20 billion-plus payday was just around the corner.
About 18 months after getting serious about selling motorways development WestConnex, Perrottet's team had two Australian capital markets heavyweights going toe-to-toe and seeking to buy 51 per cent stake in the state's biggest infrastructure project.
It had been a long and winding road; more than one year's scoping and sale preparations, and another six months taking more than a dozen different investors through the data room and auction.
But on July 19 the end was in sight. It was Thursday morning and bids were due to land in the offices of Perrottet's adviser, Goldman Sachs, the following Monday.
Anthony Macdonald has the full story here.
Yesterday
The Australian dollar is tentatively rising after it dropped in the hour leading up to the trade tariff deadline.
Having hit a low of US71.58¢, the Aussie dollar is now trading closer to US71.65¢.
It's just gone 1am in Washington DC and there's a chance we will have to wait a few hours for further developments.
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Yesterday
This is what Americans voted for.
Donald Trump is merely keeping his end of the bargain and delivering the disruption he promised, in spades.
The mayhem, the discord and the chaos now on display across Washington is what the people ordered up.
And as jaw dropping as this week's events are, this is what "punishing the elites" and "draining the swamp" looks like in practice – a body politic in full-scale anaphylaxis.
Jacob Greber has the full story here.
Yesterday
The 2pm deadline has been and gone, and far as we're aware, no tariffs so far.
The Aussie dollar shot lower in the lead up to 2pm however it has risen slightly since then.
The S&P/ASX 200 index is down 44.6 points, or 0.7 per cent, at 6115.8.
CSL is still the market's biggest weight, falling 3.1 per cent while BHP Billiton has fallen 1.1 per cent.
Southern Cross Media has fallen, down 3.9 per cent while Alumina is down 3.8 per cent.
Commonwealth Bank is still leading the index with Rio Tinto and Newcrest Mining the next best performing.
Pilbara Mineral and Galaxy Resources are the index's best performers, up 9.2 and 6.2 per cent respectively. Sigma Healthcare is up 5.6 per cent.
Yesterday
Investor home lending fell to its lowest level in nine years in July as banks tightened housing credit for investors, spurred by the banking royal commission and regulator APRA.
New mortgage commitments for investor borrowers fell 1.3 per cent from June to $10.2 billion, accounting for 32.6 per cent of all new loan commitments - the weakest level since August 2009 - official figures on Friday showed.
"The underperformance in investor relative to owner-occupier lending is consistent with what we would expect in response to a tightening in lending standards, the consequence of both the Banking Royal Commission, and macroprudential policies," JP Morgan economist Henry St John said.
Michael Bleby has the full story here.
Yesterday
Some of America's most prominent technology companies and retailers made a last-minute push to convince President Donald Trump to reverse course on a plan to impose tariffs on $US200 billion ($278 billion) in Chinese imports.
Members of the public had until Thursday to comment on the administration's plan to slap tariffs on everything from bicycles and baseball gloves to digital cameras, paving the way for Trump to announce the tariffs as early as Friday.
Trump in an interview with Bloomberg News last week showed no sign of backing down, repeating his long-standing complaint that China has taken advantage of the US and its leaders for decades. "It's time to stop. We can't let this happen," the president said.
Read the full story here.
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Yesterday
Australia's dollar is finding itself in unusual company these days, getting sold along with former emerging-market darlings such as the Indonesian rupiah and Indian rupee.
As a rout grips developing markets, the Aussie - viewed as a barometer for global risk appetite - is also bearing the brunt of investor angst. While nobody's expecting the currency to be swept up in full-fledged contagion, it is being battered due to the economy's close ties to China and reliance on offshore funding.
"Australia's economic growth has become more highly linked to the Asia region through commodities, services and as a source of capital," said Greg Gibbs, founder of Amplifying Global FX Capital Pty. "So the Aussie is used as a proxy trade for risks for the region, even if they have not materialised in weaker growth in Australia or lower commodity prices."
Read the full story here.
Yesterday
National Australia Bank has been accused of misleading customers and breaching financial services laws, in a new lawsuit from the corporate watchdog that alleges it charged hundreds of thousands of superannuation members about $100 million for services that were not provided.
In a fresh blow to the bank after its gruelling appearance at the royal commission last month, the Australian Securities and Investments Commission (ASIC) on Thursday launched the action against two NAB-owned trustees, which are meant to look after super fund members' interests.
The case is ASIC's first action over an industry-wide scandal known as "fee for no service" that has cost consumers about $1 billion. The watchdog is expected to take further action against other major financial institutions over the issue.
Clancy Yeates & Mathew Dunckley have the full story here.
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