To the scoreboard:
- Dow: 24,700.45 -219.21 (-0.88%)
- S&P 500: 2,774.02 -19.82 (-0.71%)
- AUD/USD: 0.7369 -0.0046 (-0.62%)
- ASX200 SPI futures (September contracts): 6,166 (-8)
1. Global stocks slumped in the wake of President Trump’s $US200 billion tariff threat against China. Stocks in Shanghai came off their lows but finished down 1.7%, while there were heavier fall in Europe compared to the US, led by China-exposed sectors including mining and materials.
2. The US dollar index rose to a one-week high as the greenback outperformed all the major pairs, including the safe-haven Japanese yen. The threat posed by trade tensions to global economic growth drove an overnight fall of around 1% for the AUD and Kiwi dollar.
3. Oil prices tumbled, as benchmark brent crude had its biggest one-day fall in two years. Selling intensified after Libya said it would reopen shipping ports, even though there was a big draw in US crude inventories. Analysts told Reuters the move was mainly an unwind in speculative positioning.
4. The producer price index in the US rose by 0.3% in June to the highest level since 2011, lifted by accelerating costs of services and vehicles. Benchmark US 10-year bond yields held steady at around 2.84%.
5. The Bank of Canada hiked its key rate by 25 basis points to 1.5%, as expected. In its statement, the central bank noted solid jobs growth but highlighted growing trade tensions with the US.
6. Iron ore prices dipped slightly amid the collapse in other commodities. Along with oil, it was a rough night for base metals as copper slumped by more than 3% while gold came under more pressure amid broader strength in the USD. Bitcoin was comparatively stable — it’s little-changed this morning at around $US6,350.
Here’s a look at today’s economic calendar:
- All-important CPI inflation data is out in the US.
- Eurozone industrial production figures and ECB meeting minutes
- China reports trade numbers.
Have a great day.