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Local shares traded lower at the open on Friday following a steep decline in US futures in after-hours trade. The retreat was in response to a new proposal from the Trump administration to apply additional tariffs on $US100 billion of US imports from China. Prior to the selloff, US share markets had enjoyed a constructive session after the Trump Administration had initially played down trade war concerns. At the close of trade for the US floor session, the Dow Jones index was higher by 240 points or 1.0%. The S&P 500 index was up by 0.7%. The Nasdaq rose by 34 points or 0.5%.
The ASX 200 opened with a gain of 2 points before trading at a 27 point low in the first half hour of the session. Thereafter the accelerated selling ended, although buyers were absent for the remainder of the morning with the index edging higher, off session lows.
Most ASX sectors were lower at lunch, the leading decliners were Consumer Discretionary, Information Technology and Healthcare. A small consolation in the face of the weakness was the limited participation. Turnover was lower than average Participation saw around 1.1 billion transactions being measured by the ASX valued at $1.3 billion. At lunch 466 shares were higher, 519 were lower and 391 were unchanged.
Shares in education provider Navitas (NVT) added to Thursday’s declines, which were motivated by an underwhelming update. A short time ago NVT shares were 4% lower at $4.46, having lost a similar amount yesterday. Similarly, shares in Blue Sky Alternative Investments (BLA) continued to plummet, shedding 17%, in turn bringing the weekly decline to more than 50%. The devaluation comes after US investment house Glaucus raised questions around the money manager’s operating model. The ensuing response from BLA raised more questions than answers in addition to extensive punditry.
Lithium miners were firmer as a group, with Orecobre (ORE) and Galaxy Resources (GXY) each ahead by more than 4%. Myer (MYR) shares firmed by 6% amid press articles suggesting the department store operator is on the takeover radar. More broadly, banks were a weight on the market, handing back a portion of yesterday’s gains. Iron ore miners were generally lower; iron ore prices were flat in the last day with Chinese markets closed for a public holiday.
In currency trade the Aussie dollar fell and recovered against the US dollar in early regional trade following the release of newly proposed tariffs by the Trump Administration. The Aussie dollar has attracted support in recent days with market participants taking heart from this week’s stronger Australian trade and retail sales data. The next major catalyst will be the US Non Farm Payrolls report due late tonight local time. Overnight , the Aussie dollar fell from highs near US77.26 cents to lows near US76.73 cents and was near US76.86 cents in late US trade. A short time ago the local unit was at US77.26
Published by CommSec