Eurozone shares fell 0.4% on Friday (the first anniversary of Britain’s vote to leave the EU) but Wall Street managed a mixed to positive finish with the US S&P500 up 0.2%.
Reflecting the small positive US lead, ASX 200 futures rose 3 points or 0.1% meaning a flat start to trade on later this morning.
Local investors will have the $1.49 billion move into the UK and issue from Link, and news of a higher bid for Rio Tinto’s NSW coal mining assets (more than $US2.6 billion, or more than $A3.5 billion), which will raise the prospect of more capital management from both companies.
After the oil-inspired sell off last week, the small rise on Friday night should steady local nerves today for a while.
Global shares mostly rose over the last week, despite the sell-off in oil and falls energy shares.
US shares rose 0.2%, Japanese shares rose 1%, Chinese shares rose 3% but Eurozone shares lost 0.3%.
Australian shares fell 1% thanks to a combination of falling oil prices hitting resource stocks, “fear of Amazon” (as the AMP’s Chief Economist, Dr Shane Oliver put it) weighing again on retailers and worries (“mistaken in my view, given it will take so long”, according to Dr Oliver) that China’s inclusion in MSCI share benchmarks will see funds flow out of Australian shares.
And on Friday there was the pressure from the surprise new bank levy in South Australia, on top of the federal levy which starts on this Saturday.
The big four banks were heavily sold off early last week, and recovered on Thursday before news of the additional bank levy sent them lower. They ended the week down between 1.2% 1.7%, with the exception of the Commonwealth which was down only 0.8%.
Bond yields were flat to down, the plunge in the oil price continued and this along with a slightly stronger $US weighed on the $A which ended just over 75.65 US cents.
On Wall Street, the S&P 500 rose 3.80 points, or 0.2%, to end at 2,438.30 with technology stocks up 0.7% and energy shares adding 0.8% as oil futures rose slightly (it was a relief they didn’t fall).
The Dow slipped 2.53 points to close at 21,394.76 in an up-and-down session, while Nasdaq Composite was up 28.56 points, or 0.5%, to finish at 6,265.25.
For the week, the S&P 500 posted a weekly gain of 0.2%, while the Dow industrials were mostly flat and the Nasdaq logged a 1.8% weekly gain.
