Good morning team, Chris Conway your Chief Market and Trading Strategist here with your First Look.
SPI futures are pointing to a circa 40-point fall on the open this morning, after US markets fell sharply overnight.
sentiment on iron ore and base metals turned decidedly negative overnight and hammered the shares of BHP Billiton and Rio Tinto in both London and New York.
The spot price of iron ore dropped 4.6% to $US63.20 a tonne, accelerating from Monday’s 3.5% slide, amid signs of some panic emerging in China with buyers looking to dump cargoes and steel mills reluctant to buy as they position for still lower prices.
Iron ore has now fallen one-third from its February peak. While the slide back towards the $US60 a tonne mark has been forecast, the speed at which it has retreated wasn’t.
Zinc and nickel also fell sharply. London Metal Exchange zinc for delivery in three months fell 3.8% to $US2525 a tonne, the steepest decline since December. Nickel dropped 4.5%, the most since November. Copper and aluminium also fell.
Shares in the world’s biggest miners weren’t immune. In London overnight, BHP Billiton fell 5.6%, pacing the FTSE 100 down 2.5%. Rio Tinto fell 3.8%. Glencore and Anglo American also tumbled.
In New York, BHP was down 1.9% and Rio 1% lower. The US-listed shares of their Brazilian rival Vale slid 2.6%.
What’s on today:
Local data: WBC leading index March, New motor vehicle sales March
Overseas data: Euro zone trade balance February, Euro zone CPI March; US Fed Beige Book
SPI futures down 39 points or 0.7% to 5793
AUD -0.4% to 75.56 US cents (Overnight range: 75.34 – 75.96)
On Wall St, Dow -0.6%, S&P 500 -0.3%, Nasdaq -0.1%
In New York, BHP -1.9%; Rio -1%
In Europe, Stoxx 50 -1.1%, FTSE -2.5%, CAC -1.6%, DAX -0.9%
Spot gold +0.5% to $US1291.27 an ounce
Brent crude -0.7% to $US54.98 a barrel
Iron ore (Metal Bulletin) -4.6% to $US63.20 a tonne
Dalian iron ore -2.5% to 470 yuan
LME aluminium -0.9% to $US1892 a tonne
LME copper -2.1% to $US5573 a tonne
10-year bond yield: US 2.18%, Germany 0.15%, Australia 2.48%
What happened overnight: