Australian Market Recovers After Weak Start

(RTTNews) - The Australian stock market has climbed into positive territory on Monday after opening lower following the negative cues from Wall Street Friday amid worries about rising U.S.-China tensions and the surge in coronavirus cases.

The benchmark S&P/ASX 200 Index is advancing 19.20 points or 0.32 percent to 6,043.20, after touching a low of 6013.10. The broader All Ordinaries Index is adding 21.70 points or 0.35 percent to 6,169.70. Australian stocks closed notably lower on Friday.

Gold miners are higher after safe-haven gold prices rose to new record high on Friday. Evolution Mining is advancing more than 2 percent and Newcrest Mining is adding more than 1 percent.

Lynas Corp. said it has signed a contract with the US Department of Defense to begin initial work for a heavy rare earth separation facility in Texas. Shares of the rare earths producer are gaining more than 8 percent.

Among the major miners, Rio Tinto is lower by almost 1 percent and BHP Group is down 0.1 percent, while Fortescue Metals is edging up 0.1 percent.

The big four banks are mixed. ANZ Banking is lower by 0.2 percent and Westpac is down 0.1 percent, while National Australia Bank is adding 0.2 percent and Commonwealth Bank is edging up 0.1 percent.

In the oil sector, Santos is losing almost 3 percent, Oil Search is lower by almost 2 percent and Woodside Petroleum is declining more than 1 percent, even asr crude oil prices rose on Friday.

Perpetual said it has agreed to acquire U.S.-based investment management business Barrow, Hanley, Mewhinney & Strauss LLC for $319 million. The fund manager's shares are in a trading halt until Wednesday.

In the currency market, the Australian dollar is almost unchanged against the U.S. dollar on Monday. The local unit was quoted at $0.7096, compared to $0.7094 on Friday.

On Wall Street, stocks closed lower on Friday as semiconductor giant Intel came under pressure after reporting better-than-expected second quarter results but warning of further delays in production of its next-generation chips. Concerns about rising tensions between the U.S. and China also weighed on the markets after Beijing decided to revoke the license for the establishment and operation of the U.S. Consulate General in Chengdu. The move comes just days after the U.S. government ordered China to close its consulate in Houston, Texas, amid accusations Chinese diplomats aided in economic espionage and the attempted theft of scientific research.

The Dow slid 182.44 points or 0.7 percent to 26,469.89, the Nasdaq slumped 98.24 points or 0.9 percent to 10,363.18 and the S&P 500 fell 20.03 points or 0.6 percent to 3,215.63.

The major European markets also showed significant moves to the downside on Friday. While the German DAX Index tumbled by 2 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index slumped by 1.5 percent and 1.4 percent, respectively.

Crude oil prices edged higher on Friday despite concerns about an escalation in tensions between the U.S. and China, as stronger-than-expected economic data from Europe and the U.S. helped ease worries about energy demand outlook a bit. WTI crude for September added $0.22 or about 0.5 percent to $41.29 a barrel.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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