‘Turbulence will continue,’ says Australian stock market boss
Market turbulence will continue over coming months, the chief executive of the Australian Stock Exchange says.
As the benchmark ASX200 took a 2% hit in early trading this morning, ASX CEO Dominic Stevens said that in the 2020 financial year would see “elevated volatility” because of the geopolitical situation and the changing expectations for interest rates.
My colleague Ben Butler writes that with rates at record lows and the market expects further cuts in coming months as the Reserve Bank tries to boost Australia’s sluggish economic growth.
But while markets around the world may be melting down, it’s been a good year for the ASX. It said this morning that profits after tax rose 10.5% in the year to 30 June, to $492m. Shareholders in the market operator will reap the benefits, trousering dividends for the year totalling 228.7c a share – up 5.7% on last year’s payout –- plus a special dividend of 129.1c a share from the sale of ASX’s stake in technology company Iress.
Australia opens down 1.8%, Japan off 1.9%
Trading has started in Asia with steep falls – as expected – in Australia and Japan.
Good morning/evening … wherever you are in the world, welcome to the Guardian’s business live blog which is starting early today before what’s expected to be a turbulent day on the financial markets.
My colleague Graeme Wearden covered all the action in the UK, Europe and the US on Wednesday and you can catch up on his blog here.
But in the meantime here are the main points:
- Wall Street suffered huge losses after an inversion in the US bond yield curve sparked fears of an imminent recession.
- The Dow Jones plunged 800 points, or 3%, its fourth largest decline in history. The S&P500 and Nasdaq were also down heavily.
- Fears were compounded by GDP figures in Germany pointing to a recession there and data in China showing industrial production was down 17% in July.
- The numbers sent European markets down, with the FTSE100 off more than 100 points.
- Oil slumped on fears of a global downturn.
- Donald Trump lashed out at the Fed chairman, Jerome Powell, calling him “clueless”.
Here’s our news wrap of yesterday – and I’ll have today’s opening scores in a few minutes when trading starts in Sydney.