To the scoreboard:
Dow: 23,644.19 -458.92 (-1.90%)
S&P 500: 2,581.88 -58.99 (-2.23%)
AUD/USD: 0.7661 -0.0001 (-0.01%)
ASX200 SPI futures (June contracts): 5,746 (+10)
1. US stocks get rolled: The main catalysts appeared to be an announcement of retaliatory tariffs by China, and continued concerns about the tech sector as the NASDAQ fell into negative territory for the year. President Trump maintained his recent attacks on Amazon overnight — shares in which closed more than 5% lower. The S&P500 has now fallen below its 200-day moving average for the first time since June 2016.
2. Amid a more risk-off mood in global markets, the Aussie dollar dipped overnight although it was another mixed session for the US dollar — with the negative tone towards the USD still evident in currency markets. Among the major currency pairs, the greenback rose against the euro but lost ground to the UK pound and Japanese yen.
3. Bonds have been the vehicle of choice for safe-haven capital flows in the wake of the US stock malaise, as benchmark US 10-year bond yeilds dipped below 2.74% — the lowest level since the yield spike in early February when inflation fears rattled markets.
4. And gold took a bounce, rising by more than 1% to climb back above $US1,340 an ounce after drifting off their recent highs into the Easter break. And iron ore rallied for the second straight session after its recent run of heavy falls, amid a strong demand outlook as China’s construction season gets underway.
5. RBA on hold: Today’s rates announcement (2:30pm AEDT) is likely to be a formality, with the central bank expected to keep rates on hold at 1.5% wile maintaining its optimistic view about economic growth. Also this morning there’s Ai Group manufacturing PMIs and ANZ’s weekly consumer confidence measure.
6. Dividend tail-wind for US stocks: There could be some welcome relief around the corner for nervous US stock investors — in the form of a record $US400 billion in dividend payments. Morgan Stanley analysts say dividend flows have historically acted as a buffer for US stocks in the spring months between March and May.
Have a great day.