Wall Street dragged lower by widespread technology sell-off


July 31, 2018 08:40:29

Technology stocks have been sold off once again, which sank the tech-heavy Nasdaq index for the third straight day and weighed on the broader market.

Markets at 7:00am (AEST):

  • ASX SPI 200 futures flat at 6,225, ASX 200 (Monday’s close) -0.4pc at 6,278
  • AUD: 74.03 US cents, 56.32 British pence, 63.24 Euro cents, 82.26 Japanese yen, $NZ1.09
  • US: Dow Jones -0.6pc at 25,307, S&P 500 -0.6pc at 2,803, Nasdaq -1.4pc at 7,630
  • Europe: FTSE flat at 7,701, DAX -0.5pc at 12,798, CAC -0.4pc to 5,491 Euro Stoxx 50 -0.4pc at 3,514
  • Commodities: Brent crude +0.7pc at $US74.82/barrel, spot gold -0.1pc at $US1,221.30/ounce, iron ore +0.2pc at $US67.65/tonne

Twitter shares plunged 8 per cent and was the worst-performing stock on the S&P 500.

Among the “FANG” stocks, Facebook, Amazon and Google have lost about 2 per cent each, while Netflix dipped by almost 6 per cent.

This dragged the S&P technology sector down by 1.8 per cent, as investors looked to other sectors or took profits ahead of the volatile mid-term election season.

Control of both the US House of Representatives and Senate are at stake in the November elections.

Trade concerns also rattled investors, on reports that trade representatives from the European Union, Canada, Japan, Mexico and South Korea are planning to meet in Geneva next week — to discuss a response to threats made by US President Donald Trump to slap tariffs on imported automobile and car parts.

The energy sector was among the best performers (+0.8pc) on higher oil prices due to potential supply disruptions in the Middle East.

The Nasdaq fell 1.4 per cent overnight. Its losses across a three-day period totalled 3.8 per cent.

The benchmark S&P 500 fell 0.6 per cent on Monday (local time), and the Dow Jones lost 0.6 per cent to 25,307.

It was also a weak night in European markets with London closing flat. Paris and Frankfurt ended in negative territory, down 0.4 and 0.5 per cent respectively.

Australian market today

In economic news, the Bureau of Statistics will release its latest building approval figures (June), which is a measure of future construction activity.

Reuters-polled economists are expecting building approvals to remain steady, practically flat — compared to May’s 3.2 per cent fall.

The Reserve Bank will also release private sector credit figures for June. ANZ is expecting the amount of borrowing by consumers and businesses to rise 0.3 per cent.

ASX futures are down 2 points, suggesting the Australian share market is expected to open very slightly lower.

The Australian dollar is steady at 74 US cents, 56.4 British pence, 63.2 Euro cents and 82.2 Japanese yen.

The US greenback was weaker overnight as markets await the Bank of Japan’s monetary policy decision, with no interest rate hike expected for some time.

“It seems that the BoJ would be happier to see long term rates increase but it doesn’t want to see a concurrent appreciation of the yen,” said NAB currency strategist Rodrigo Catril.

“It’s a difficult balancing act and the central bank will need to get its messaging right.”










First posted

July 31, 2018 08:05:44

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