US stocks ended lower on Monday, ending near the worst levels.
Investors are anticipating what could be a volatile trading week ahead of Federal Reserve Chairman Jerome Powell’s final comments on inflation at the central bank’s annual meeting in Jackson Hole.
The latest Reuters poll of economists highlighted expectations of a 50 basis point Fed hike next month in line with market prices.
In Europe, a number of concerns center on natural gas prices hitting record highs in Europe overnight amid Russia’s latest update that it will shut down the Nord Stream pipeline for three days of maintenance this month.
Some of the more cautious strategists are increasingly pointing to stretched valuations and the risk of further deterioration in earnings revisions,
And China was forced to cut interest rates again, in a bid to relieve some relief from the country’s huge construction and real estate sector. The rate cut comes as record high temperatures and a severe drought have crippled hydropower and shut down many factories in west-central China, an industrial base.
Overnight, the Dow Jones fell 1.91%, the S&P 500 fell 2.14% and the Nasdaq Composite fell 2.55%. , the broader market index remains about 13% above its June lows.
Across all sectors, tech stocks fell on concerns over more aggressive rate hikes from the Fed. Amazon fell 3.6%. Semiconductor stocks fell with Nvidia down around 4.6%. Shares of Netflix fell about 6.1% following a downward earnings revision.
The semiconductor industry is now reportedly bracing for a downturn due to an oversupply of chips – the exact opposite of the challenge it has faced for the past few years due to COVID. Citigroup, told Bloomberg that they expect the coming semiconductor downturn to be “the worst in at least a decade, and maybe two.”
In Europe, their energy crisis has sparked a global battle over natural gas tankers, leading to a shortage of ships and further driving up record fuel prices. LNG and the tankers that transport the fuel were in high demand even before the Ukrainian conflict, as extreme weather reduced hydropower and many economies sought to switch from coal to reduce carbon emissions. The war accelerated this trend.
The trend is also playing out in the United States, as Bloomberg reports that gasoline inventories in New York are so low that suppliers are resorting to expensive American ships to transport fuel to the region. Gasoline and diesel tanks in the New York Harbor area are at their emptiest level in nearly three decades of government record keeping
It seems that an energy crisis is currently playing out around the world
An Australian dollar at 7:15 a.m. was flat against the US dollar yesterday, buying 68.76 US cents (Mon: 68.76 US cents), 58.53 pence sterling, 94.58 yen and 69.15 euro cents .
Iron ore futures are pointing to a 0.5% gain.
Gold lost $14.50 or 0.8% to US$1,748 an ounce.
Silver was down $0.20 or more 1% at US$18.98 an ounce.
Copper fell $1.75 or 0.5% to settle at US$365.35 per pound.
Oil prices rebounded from session lows to trade nearly flat in a volatile session on Monday, after Saudi Arabia’s energy minister said OPEC+ could cut production to make in the face of market challenges. Oil closed down 0.6%
SPI futures point to a 0.6% decline.
Six companies are ready to trade without the right to a dividend.
Australian clinical laboratories (ASX:ACL) pays 41 cents fully franked
Australian United Investment Corporation (ASX: AUI) pay 20 cents fully franked
Domain Holdings Australia (ASX:DHG) pays 4 cents fully franked
Diversified unified investment (ASX: DUI) pays 9 cents fully franked
HPI (ASX: HPI) pays 16 cents 50 percent franked
Qualities (ASX: QAL) pays 4 cents fully franked
Three companies are ready to pay eligible shareholders today.
Dexus Convenience Retail REIT (ASX:DXC)
Dexus Industry REIT (ASX:DXI)
Transurban Group (ASX:TCL)
Numbers around the world
Across the Atlantic, European markets closed lower. Paris fell 1.8%, Frankfurt 2.3% and London’s FTSE closed down 0.2%.
Asian markets closed on a mixed note. Tokyo’s Nikkei fell 0.5%, Hong Kong’s Hang Seng lost 0.6% and China’s Shanghai Composite closed up 0.6%.
The Australian equity market fell nearly 1% to 7047 yesterday.
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.