Source : THE AGE NEWS
By Staff reporters
The Australian sharemarket has pared early gains but remains solidly in the green at lunchtime as it looks to extend its winning streak to eight sessions.
The ASX 200 was up 54.4 points, or 0.7 per cent, to 8351.9 at 12.12pm AEST, with eight of 11 industry sectors in the green, with consumer, energy and tech stocks in negative territory.
Wall Street has had another day of choppy trade.Credit: AP
Commonwealth Bank – the biggest stock in the market – was 0.3 per cent higher to $170.26 in early trade. It hit a record of $172.92 early in the session. NAB rose by 1 per cent, Westpac rose 0.5 per cent and ANZ was flat.
Among the miners, BHP was 1.9 per cent higher, Rio Tinto added 1.3 per cent and Fortescue jumped 1.2 per cent. A rise in gold prices sent local players higher, with Evolution Mining (up 4.6 per cent), Perseus (up 4.5 per cent), Newmont (up 4 per cent) and Northern Star (up 4 per cent) surging.
Property giant Dexus was 3.2 per cent lower after the ASX-listed company, which owns a stake in Melbourne Airport, was served a notice by the board of the airport alleging it had breached confidentiality arrangements in the sale process of its shares. Dexus has denied the allegations.
The Australian dollar was steady at 64.08 US cents at 12.18pm AEST.
On Wall Street, US stocks drifted higher in quiet trading following a jumble of mixed reports that offered little clarity on how the US economy is managing through President Donald Trump’s trade war.
The S&P 500 rose 0.4 per cent, enough to extend its winning streak to a fourth day and to pull within 3.7 per cent of its all-time high set earlier this year. The Dow Jones added 271 points, or 0.6 per cent, and the Nasdaq composite slipped 0.2 per cent.
Wall Street stocks got a lift from easing Treasury yields in the bond market. They fell after the economic reports suggested the Federal Reserve may have more room to cut interest rates later this year to bolster the US economy if it weakens under the weight of high tariffs.
But the reports did little to spell out whether the economy is falling toward a recession, as many investors had been fearing, or shaking off the uncertainty after Trump called off many of his tariffs temporarily. The headline reports said shoppers spent less at US retailers last month than expected, while inflation was better at the wholesale level than economists forecast. Other updates said US manufacturing looks like it’s still contracting, but fewer US workers are applying for unemployment benefits than expected.
Even though China and the United States recently agreed on a 90-day stand-down for many of their tariffs, “the trade story isn’t over, and it’s still going to take time for tariffs to make themselves felt in economic data,” according to Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management.
Such uncertainty showed itself in Walmart’s stock, which slipped 0.5 per cent even though it reported a bigger profit for the latest quarter than analysts expected.
Like other US companies struggling through Trump’s on-again-off-again rollout of tariffs, Walmart said it decided not to offer a forecast for how much profit it will make in the current quarter.
Chief Financial Officer John David Rainey pointed to “the range of near-term outcomes being exceedingly wide and difficult to predict”, though the company did say it expects sales to grow between 3.5 per cent and 4.5 per cent, not including the swings that shifting values of foreign currencies can bring.
The nation’s largest retailer also said that it must raise prices due to higher costs caused by Trump’s tariffs.
Elsewhere on Wall Street, Dick’s Sporting Goods tumbled 14.6 per cent after it said it would buy the struggling Foot Locker chain for $US2.4 billion ($3.8 billion). Dick’s also said that it made a better profit for the latest quarter than analysts expected.
Foot Locker soared 85.7 per cent after coming into the day with a loss of nearly 41 per cent for the year so far.
All told, the S&P 500 rose 24.35 points to 5916.93. The Dow Jones Industrial Average added 271.69 to reach 42,322.75, and the Nasdaq composite fell 34.49 to 19,112.32.
In the oil market, crude prices sank roughly 2 per cent on expectations that more petroleum could be set to flow into global markets because of a possible deal between the United States and Iran over that country’s nuclear program. Such a deal could help ease sanctions against Iran, which is a major producer of oil.
Elsewhere, China moved to reverse some of its “non-tariff” measures against the US, as agreed with Washington in their temporary trade war truce, while demanding that the US side “immediately correct its wrong practices”.
A Chinese Commerce Ministry spokesperson accused the Trump administration of violating world trade rules by announcing that use of Ascend computer chips made by China’s Huawei Technologies violates US export controls.
The two-year Treasury yield, which more closely tracks expectations for Fed action, dropped to 3.96 per cent from 4.05 per cent as traders built bets that the Fed will resume cutting its main interest rate as soon as September.
Fed Chair Jerome Powell warned in a speech on Thursday that the world “may be entering a period of more frequent, and potentially more persistent, supply shocks” that could push inflation higher and present a “difficult challenge for the economy and for central banks”.
AP
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