Market Update: Downturn In The US Markets, Yet Again

On October 18, 2018, the US markets again ended on the negative note citing global tensions as well as escalating trade tension between the US and China. Actually, Chinese markets are also witnessing a strong downturn. Dow Jones Industrial Average ended the day at 25,379.45 which implies the fall of 327.23 points or 1.27%. The technology stocks also witnessed the downtrend. The fall in the US markets is largely attributable to the decision of the Treasury Secretary Steven Mnuchin of backing out from the meeting in the Saudi Arabia. The concerns with regards to Chinese markets, Italy’s budget were also the primary reasons which negatively impacted the global markets. The decision of the backing out from the summit in Saudi reflects that the tensions between the US and Saudi are on the rise.

Saudi Arabia is expected to retaliate against the sanctions which have been imposed by the US. The investors are under the pressures of the global macro events which are beyond their control. The roller coaster ride of the global equity markets would continue to impact the investors’ sentiments. Earlier, the concerns related to the treasury yields have also fueled the global sell off in the equities.

Among the tech stocks, Netflix Inc. (NASDAQ:NFLX) ended October 18 by falling 4.93% while Facebook (NASDAQ:FB) tumbled 2.82%. It seems like the economic growth in China has been struggling lately because of the trade battle with the US. The help which was provided by the Chinese government to face the debt risks has negatively impacted the economy’s growth prospects. In addition, due to trade tensions, exports got suffered.

Amid Global Downturn, What’s Happening in Australian Markets: While the global markets are witnessing the downturn, the Australian markets have managed to stabilize. However, still they ended marginally lower. Nonetheless, marginal fall has been digested by the Australian market investors and the players are of the views that amid global downturn the Australian markets ended marginally lower which is the positive sign. However, certain macro concerns still loom over the economy. The market participants are expecting that recent jobs data could have helped the broader markets. The Australian economy witnessed a fall in the unemployment rate for September 2018.

However, if the strict lending conditions are imposed, the economy could witness the negative impact because of lower spending by the business as well as by the retail consumers. With markets ending today on a decent note, it can be said that the potential negative impacts of the selloff in the Chinese markets have been tackled by the Australian equities.

On October 19, 2018, S&P/ASX200 ended the day at 5939.5 reflecting a marginal fall of 2.9 points. Shares of Galaxy Resources Limited (ASX:GXY) and Resolute Mining Limited (ASX:RSG) ended the day by advancing 6.364% and 6.132%, respectively. Spectur Limited (ASX:SP3) posted the revenues of $1.1 million in the September quarter. For full post click here. However, the stock price of Biotron Limited (ASX: BIT) witnessed the substantial rise today because of the underwriting agreement.

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