After early gains, Wall Street lost ground and turned lower in the last hour of trading Tuesday as tech investors warily eyed the slate of earnings reports from tech giants like Apple, Amazon, Alphabet, and Facebook due from Wednesday onwards.
For the local market there’s a small gain ahead at the start but the big news was the bounce in the Aussie dollar to around the 65 US cent level for the first time since March 10. Risk is well and truly off.
As well there’s tomorrow’s statement from the US Federal Reserve after its two-day meeting and a media conference by chair, Jay Powell. Tomorrow also sees the release of the first estimate of US March quarter economic growth.
On top of that, there’s the weekly report on US production, consumption, and storage with the latter being the key data eyed by investors.
Earnings reports on Tuesday were mixed to weak to close mostly lower on Tuesday as investors gird for a slew of corporate earnings and the possibility that resuming normal economic activity could reignite coronavirus infection rates.
3M shares jumped nearly 3% after it announced earnings and sales that beat expectations.
Ford, however, released a $US2 billion first-quarter loss due to the impact of the COVID-19 pandemic and said it expected its loss in the second quarter to more than double as it survives a shutdown of its North American plants.
Ford shares rose 4% ahead of the release of the figures after trading.
The Dow fell 32.23 points, or 0.13%, to 24,101.55, the S&P 500 eased 15.09 points, or 0.52%, to 2,863.39 but the Nasdaq fell 122.43 points, or 1.4%, to 8,607.73.
Investors have been wondering if the recent run-up for tech stocks since the March 23 market bottom is sustainable given the sagging wider economy and fears that a restart of economic and social activity could trigger a new set of problems.
Commodity prices fell – WTI oil was positive but fell at the close while Brent futures rose. Iron ore fell 1.5%, copper and gold were weaker.
The US dollar was weaker, allowing the Aussie dollar to climb past 65 US cents for the first time in more than six weeks. The buck was around 65 US cents in early Asian trading at 6.30 am Sydney time.
The overnight futures market was signally a small gain at the start of trading later this morning here, but the 14 point rise at 6.30 am was half what it was an hour earlier.
The ASX 200 saw a lacklustre day on Tuesday. After starting with a gain of 50 points in the first hour, the index then drifted for the rest of the session and got to 50 points below the opening.
The index then regained most of that lost ground to end the day 8 points lower at 5,313, for a tiny fall of 0.16%
Westpac’s big write-down took the attention and knocked some of the confidence out of investors coming a day after the NAB’s sharp profit and dividend fall and big capital raising which went off smoothly with the $3 billion raised from the big end of the share register.
Lendlease also announced plans to raise $1.15 billion.
