Australian shares are poised to fall when trade begins after the long weekend amid fears the spread of the deadly coronavirus will hurt global markets.
The SPI200 futures contract was down 89 points, or 1.27 per cent, at 6913 at 0800 AEDT on Tuesday.
Australia’s benchmark S&P/ASX200 index finished Friday up 2.5 points, or 0.04 per cent, at 7,090.5 points, despite worry about the coronavirus.
The broader All Ordinaries index closed 4.2 points higher, or 0.06 per cent, at 7,203.2.
IG market analyst Kyle Rodda says risk aversion continued to be fuelled on Monday, when local markets were closed, as the reported number of cases of the virus in China climbed towards 3000, and the number of official fatalities leapt above 80.
“China remains in a state of shutdown as authorities look to contain the viruses spread. China’s financial markets will not re-open, as it currently stands, until February 3rd,” he said.
Locally this week, investors are waiting to see the Reserve Bank of Australia’s quarterly consumer price index data for the three months to December.
Inflation is a crucial consideration for the RBA in setting the cash rate – and many analysts are still expecting two rate cuts this year.
ANZ research says the recent strength in employment gives the RBA breathing space. They tip April as the likely date for the next rate cut, with another a few months later.
The Australian dollar was buying 67.6 US cents, down from 68.46 US cents at the market close on Friday.