Following a positive day on Tuesday, the Australian market could be in for a rough session today with SPI futures trading down 75 points at 8:30 am AEST.
Resources are expected to take a hit, particularly those sensitive to Chinese data, after disappointing Chinese data overnight.
The ASX200 finished up 26 points (0.35%) yesterday at 7,302. Healthcare (+3.16%) was the standout sector, led by solid earnings from large caps including CSL Ltd and Cochlear Ltd, while IT (+1.76%) also finished strong.
What happened overnight?
Here’s what we saw (source CommSec):
US markets
US sharemarkets fell on Tuesday after stronger-than-expected retail sales data (+0.7% MoM) stoked worries interest rates could stay higher for longer, while US big banks dropped on a report that Fitch could downgrade some lenders.
Longer-dated US government bond yields rose on Tuesday after data showed US retail sales rose more than expected. Minneapolis Federal Reserve President Neel Kashkari said, "I'm not ready to say that we're done" raising interest rates.
All three major indices closed lower with the Dow Jones falling 361 points or 1%, the S&P 500 index slumped 1.2% and the Nasdaq index shed 157 points or 1.1%.
Shares of JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC) and Wells Fargo (NYSE:WFC) slipped between 2.3% and 3.2%. Regional lenders PacWest Bancorp, Zions Bancorp and Western Alliance Bank fell between 3.7% and 4.5% after the US Federal Deposit Insurance Corp's latest regulatory overhaul proposal.
European markets
European sharemarkets closed lower on Tuesday. The continent-wide FTSEurofirst 300 index fell by 1%. In London, the UK FTSE 100 index declined by 1.6% after basic earnings in Britain hit a new record growth rate in June.
China-exposed mining stocks lost 1.5%, hitting an over two-year low intraday, as base metal prices fell after data showed Chinese retail sales, industrial output and investment growing at a slower-than-expected pace. HSBC, Europe's largest bank doing business in China, dropped 3.4%. Sweden's annual pace of inflation held steady at 9.3% in July (survey: 9.3%).
Currencies
Currencies were mixed against the US dollar in European and US trade. The Euro fell from US$1.0950 to US$1.0898 and was near US$1.0900 at the US close.
The Aussie dollar dipped from US65.15 cents to US64.51 cents and was near US64.55 cents at the US close.
The Japanese yen firmed from 145.86 yen per US dollar to JPY145.10 and was near JPY145.55 at the US close.
Commodities
Global oil prices fell on Tuesday on sluggish Chinese economic data coupled with fears that Beijing's unexpected cut in key policy rates was not sufficiently substantial to rejuvenate the country's sputtering post-pandemic recovery.
The Brent crude price fell by US$1.32 or 1.5% to US$84.89 a barrel. And the US Nymex crude price dipped by US$1.52 or 1.8% to US$80.99 a barrel.
Base metal prices fell on Tuesday. The copper futures price dipped 1.7% as the outlook for Chinese demand worsened. The aluminium futures price fell by 0.3%.
The gold futures price fell by US$8.80 or 0.5% to US$1,935.20 an ounce. Spot gold was trading near US$1,901 an ounce at the US close.
Iron ore futures rose by US17 cents or 0.2% to US$104.80 a tonne after China's central bank unexpectedly cut key policy rates for the second time in three months.
Looking ahead:
In Australian company news, Bapcor, Computershare, Dexus, Endeavour Group, Fiducian Group, Fletcher Building, Mirvac, Netwealth, Seven West Media, Transurban, Vicinity and Yancoal release earnings. CBA, Computershare, Dicker Data (ASX:DDR) and ResMed trade ex-dividend.
On the small cap front
The S&P ASX Small Ordinaries gained 0.26% yesterday. You can read more about the following throughout the day.