The ASX is heading for a soft start today but the major event is mid-week and the inauguration of US President-elect Joe Biden and the lead up which threatens more violence and unprecedented security.
The tensions around that occasion and the continuing hunt for those responsible for the invasion of the US Houses of Congress, have seen stepped up security in the US capital and state capitals across the country.
President Donald Trump is going badly – fleeing the White House on Tuesday morning, US time, hours before the changeover. He has stopped being President, sitting alone in the White House and sulking, according to more and more media reports from Washington.
And overlaying all of this is the latest waves of the pandemic which is draining economic activity across Europe, the UK, Japan and the US and Canada.
Now the situation in China has worsened quickly with more cases, helping take the total cases globally to more than 93 million. More than two million people have died.
Thailand and Indonesia are reporting rising new infections as well. France has tightened its nightly curfew.
The worsening pandemic and tighter lockdowns in Europe saw Eurozone shares down 1.2% on Friday. The US S&P 500 fell 0.7% with soft economic data (retail sales), an earnings miss by a major bank (Citi) and lower energy shares ( probe of Exxon Mobil’s disclosures).
The soft US lead saw the futures market fall 16 points, or -0.2%, pointing to a soft start to trade today for the ASX
Local gold mining shares will come under more pressure after they were sold off last week. Energy shares will be hit by the first weekly fall in oil prices in three weeks.
Friday’s fall in tech stocks on Wall Street won’t help either, but the edging higher in iron ore prices could help the listed sector.
While BHP and Afterpay set new highs on Friday, the ASX 200 still faded late to finish 0.1 points higher at 6,715.4.
While technically that was a third straight gain, Friday’s session ended a softer week for the local market which fell 0.6% after 11 month highs earlier in the week.
BHP ended 1.7% ahead at $46.82 and touching a fresh intraday peak of $47.545.
Rio Tinto gained 0.7% to $120.52 and Fortescue Metals was 1.7% ahead at $25.18.
Commonwealth Bank shares fell 1.1% to $85.38, but NAB and Westpac each added 1.5%. ANZ finished 0.2% higher.
Friday’s mixed results from three big US banks – JP Morgan, City and Wells Fargo – won’t help with the banks bring back over $US5 billion of previous write down provisions to make their December quarter figures look better.
Afterpay was a standout. The buy now, pay later group saw its shares rise 10% to close at $133.15, continuing a strong run after a price upgrade by Morgan Stanley and a strong Wall Street debut by its main US competitor, Affirm.
