Market Update: Dow Jones Ended Lower. Trade War Worries Still There

  • Dec 07, 2018 AEDT
  • Team Kalkine
Market Update: Dow Jones Ended Lower. Trade War Worries Still There

It seems like the market players would be reacting immediately to the news which would be revolving around the trade worries. The trade worries have again increased after the chief financial officer or CFO of Huawei got arrested, and this order to arrest the CFO was given by the United States. This could be extremely negative at a time when the trade battle situation between the US and China is at a critical stage. Already the market players are worried about the escalation of the trade battle, and these types of occurrences at this stage would only infuse negative momentum in the global markets. Thus, it would not be wrong to say that the market participants are in the dicey position as to what they should expect when it comes to the trade battle between the US and China.

Earlier, there were little hopes that a temporary halt in the trade battle for the period of 90 days might lead to a permanent settlement. However, it seems like, after the arrest of the CFO of Huawei, even this optimism is not visible in the minds of the investors. Therefore, moving forward the equities might witness an unfavourable momentum which would further increase the worries related to the economic slowdown.

Will Oil Prices Fall Further?

It seems like nothing is going well for the market participants who could further deteriorate the sentiments of these participants. On one side, there are now worries that the trade battle between the US and China might escalate from the present stage and on the other side, the meeting on December 6, 2018, also not ended as expected by the market players. There were expectations the productions cuts would be announced at the meeting which might help the oil prices to witness a rise, and this might have helped the investors’ sentiments. However, the OPEC or Organisation of the Petroleum Exporting Countries has not yet made a decision about the production cuts.

There were strong expectations that the meeting would be ended by announcing the production cuts. The oil prices have been witnessing the negative impacts primarily because of the worries related to its demand. Moreover, everything is not good in the financial markets as well. The worries related to the slowdown with respect to the global economic growth have again started impacting the investors’ minds.

Australian Markets Ended Higher

Moving forward, if the trade battle between the US and China escalates, it could further impact the growth prospects of the global economy, including the Australian economy. However, today the S&P/ASX200 managed to close on the positive note. On December 7, 2018, S&P/ASX200 ended the session at 5681.5 which implies a rise of 23.8 points or 0.4%. Talking about the gainers, The Star Entertainment Group Limited (ASX: SGR) and Goodman Group (ASX: GMG) ended the session by witnessing the rise of 5.287% and 4.183%, respectively. On the other hand, IOOF Holdings Limited (ASX: IFL) and Adelaide Brighton Limited (ASX: ABC) closed the session by declining 35.844% and 9.533%, respectively.

Adelaide Brighton Limited has lowered its expected range for the NPAT or net profit after tax. Read the full news here. Another company, FE Investments Group (ASX: FEI) made an announcement regarding its half-yearly results. Read the full news here.

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