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 futures market is pointing to a 31 point drop when trade begins on Tuesday, after falls on Wall Street on Friday.
Australia’s benchmark S&P/ASX200 index finished Friday up just 2.5 points, or 0.04 per cent, at 7,090.5 points, despite worry about the coronavirus.
Blood products and influenza vaccine maker CSL drove those gains, pushing through the $310 a share mark for the first time to close 1.1 per cent higher at $310.70.
By Monday, more than 2000 cases of coronavirus have been confirmed worldwide and 80 people have died.
A fifth Australian case of the virus was expected to be confirmed in NSW.
Stephen Innes, Asia Pacific Market Strategist at AxiCorp, says concerns about the virus continue to impact trade.
“Traders who would be typically discussing the weekend football results are now sadly focusing on mortality scores this morning,” he said in a research note on Monday.
The biggest threat to the global economy is not just because the disease spreads quickly across countries through networks related to global travel, he said.
But also, because any economic shock to China’s colossal industrial and consumption engines will spread rapidly to other countries through the increased trade and financial linkages.
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 this week.
Inflation is a crucial consideration for the RBA in setting the cash rate – and many analysts are still expecting two rate cuts this year.
The Australian dollar was buying 68.16 US cents at noon on Monday, down from 68.46 US cents at the market close on Friday.