Market Update: Dow Tumbles As Trade Tensions Escalate

  • Oct 30, 2018 AEDT
  • Team Kalkine
Market Update: Dow Tumbles As Trade Tensions Escalate

It seems like that Mr. Market has reminded the investors about the trade worries as they were more concerned about the earnings season. The earnings season, however, has failed to cheer up the investors. On October 29, 2018, Dow Jones Industrial Average ended at 24,442.92 which implies that it has fallen 245.39 points or 0.99% in a single day. The primary reason which has severely impacted the investors’ sentiments is that the Trump administration is all set to slap further tariffs on the Chinese imports if the talks between them, which are scheduled for the next month, do not materialize. Even though for the small period of time, the investors’ attention got diverted towards the earnings season. However, the tech sector dominated the investors’ minds last week and a downfall in the tech heavy weights have dragged the broader markets as well. The investors are presently in the dicey position of whether or not to deploy their investable capital in the equities. To some extent, their concern is also justified as the global macroeconomic measures continue to get worse which could impact the overall portfolio of the investors. The markets have already suffered a lot because of the tit-for-tat approach of the US and China in regard to the imposition of tariffs.

Oil Prices Fell Further, What Lies Ahead?

The oil prices have witnessed a fall on October 30, 2018 primarily because of the downturn in the global markets as well as expectations of increased oil supply even though the fear of sanctions is still looming. The downturn in the global markets has played a great role and it seems like oil has also joined the league as evidenced by the falling momentum in prices. The markets were again disturbed when the Trump administration stated their intentions of slapping further tariffs if the meeting between the US and China does not end on a positive note. The expectations that the oil supply might witness a strong rise have also weighed heavily on the oil prices. The major producers are ready to extend their help if any demand shortages take place when the US sanctions on Iran commence from the next month. However, the market trackers are expecting that the oil demand might get hampered amidst the downturn in the global markets. Additionally, the fund managers are also of the view that the prices may fall moving forward because of the lower demand.

Australian Markets Ended on a Positive Note: What you Should Know

It seems like the Australian markets have learned the trick to tackle the global market sell-off. This can be said because while there are numerous macro headwinds which are impacting the US markets, the Australian markets managed to close on a positive note. S&P/ASX200 ended the day at 5805.1 which implies a rise of 76.9 points or 1.3%. Beach Energy Limited (ASX: BPT) and Afterpay Touch Group Limited (ASX: APT) ended the session by increasing 10.345% and 9.372%, respectively. However, James Hardie Industries PLC (ASX: JHX) closed the session on a weaker note as they fell 3.014% intraday.

Pacific Energy Limited (ASX: PEA) has made an announcement that it had managed to win new electricity supply contract. This contract has been taken from Panoramic Resources. For more information, please click here. However, Lovisa Holdings Limited (ASX: LOV) made an announcement regarding the disappointing store sales. For more information, click here.

Metminco (ASX: MNC) bailed out from the acquisition of Jejevo Nickel Project. For more information, please click here. Moreover, the market players are expecting the tighter lending growth as well as falling housing prices would impact the broader economic growth. The Royal Commission’s interim report is expected to impact lending activities as well.

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