OPENING CALL: The Australian share market is expected to open lower. The SPI200 futures contract expected to open down 120 points.
The U.S. is entitled to levy tariffs on $7.5 billion of exports from the European Union over the bloc’s subsidies to Airbus, the World Trade Organization said, potentially opening up a new front in the Trump administration’s global trade fight.
BlackRock has held talks over the past year with internet giant Tencent, as the world’s largest money manager explores ways to strengthen its foothold in China.
Each Market in Focus
Australia’s S&P/ASX 200 index closed 1.5% lower at 6639.9, rattled by growing weakness in the U.S. economy where a closely watched manufacturing gauge fell to its lowest level in more than a decade.
Banks fell after investors digested what lower home-loan rates mean for their profit margins. CBA dropped 2.1% to A$79.60 and ANZ fell 1.5% to A$28.05. NAB was the worst performer in the sector, down 2.3% at A$29.02, after signaling A$1.18 billion in new charges for customer-related remediation and a software capitalization change.
The post-tax charges are forecast to reduce NAB’s 2H cash earnings by A$1.12 billion. Elsewhere, materials stocks were lower with BHP down 1.9% at A$36.30 and Rio Tinto falling 1.6% to A$91.09.
The Dow Jones Industrial Average dropped about 500 points intraday as worries about a slowdown in the U.S. economy rattled markets to start the fourth quarter.
Concerns about slowing global growth have resumed this week, shaking a bet among U.S. investors that the trade war-induced slowdown overseas wouldn’t hit the domestic economy with the same force. That bet was upended after data Tuesday showed a gauge of U.S.factory activity contracted for the second consecutive month, falling to its lowest level
since June 2009.
The private-sector jobs report, which showed the pace of job creation has slowed, added to the concerns about the health of the economy.
The stock market’s declines were broad and accelerated through the morning. All 11 sectors in the S&P 500 fell, as did all but one of the 30 blue-chip stocks in the Dow.
Among the biggest losers were shares of big industrial and technology companies. Delta Air Lines declined 6.8%, while aluminum parts manufacturer Arconic fell 4.6%. Apple and Google lost 2.4% and 2.3%, respectively.
The Dow industrials fell 507 points, or 1.9%, following a 1.3% decline Tuesday. Those declines put the index on pace for its worst start to quarter since the depths of the financial crisis in the fourth quarter of 2008, when it fell 19%.
The S&P 500 fell 1.9%, putting it in danger of falling more than 1% in consecutive sessions for the first time this year. The last time the broad equity gauge dropped that much on back-to-back days was Dec. 24, 2018, when an end-of-year selloff nearly ended the long-running bull market. The Nasdaq Composite lost 1.7%.
The selloff heightens the anxiety for two other consumer-focused reports this week-the Institute for Supply Management’s services sector report Thursday and Friday’s payrolls report.
Gold prices settled back above the key $1,500 mark, after private-sector employment showed that the pace of hiring in the U.S. is slowing, reviving worries about a recession in the U.S. economy and spurring the purchase of assets perceived as havens.
Gold for December delivery on Comex gained $18.90, or 1.3%, to settle at $1,507.90 an ounce, after advancing 1.1% on Tuesday. The yellow metal had settled below the psychologically significant level at $1,500 in the last two consecutive sessions. Meanwhile, December silver picked up 38.1 cents, or 2.2%, to $17.683 an ounce.
U.S. crude-oil prices slid for the seventh consecutive session, hitting a nearly
two-month low after weekly inventory figures reignited worries about a supply glut.
West Texas Intermediate, the U.S. price gauge, fell 1.8% to $52.64 a barrel on the New York Mercantile Exchange, extending its longest losing streak since November 2018. Prices have erased all of their 15% rally from mid-September that followed supply disruptions in Saudi Arabia, hurt by projections for soft demand and steady production growth as
tensions in the Middle East ease.
The WSJ Dollar Index was little changed at 91.83 after a private-sector employment report showed the pace of job growth declined last month and that hiring in August was less robust than initially estimated.
The dollar pared modest early gains after investors increased bets that the Federal Reserve will cut interest rates at least once more by the end of the year. Financial futures prices peg the probability of a third Fed this year at about 85% compared with about two-in-three Monday. The dollar retained support, though, as U.S. interest rates remain much higher than those in Europe and Japan, analysts said.
European stocks went into freefall after the World Trade Organization said the U.S.could impose tariffs on $7.5 billion of European goods due to illegal subsidies to plane-maker Airbus. The Stoxx Europe 600 dropped 2.4% while the FTSE 100 fell 3.1%, or 227 points to 7133. The DAX was down 2.25% and the CAC-40 dropped off 2.7%.
Korea’s Kospi was down nearly 2% following news that North Korea fired at least one missile off its east coast. The move, seen as a show of strength, came after Pyongyang said it would resume official nuclear talks with the U.S. In Japan, the Nikkei fell 0.5% and Hong Kong’s Hang Seng was down 0.2%. Mainland Chinese stock markets were closed for a holiday.
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