Australian share market opens lower as uncertainty continues

US stocks closed lower for the sixth straight session overnight, while Shanghai plummeted more than seven per cent to continue its steepest four-day rout since 1996.

韩国半永久纹眉

The domestic market fell by about one per cent soon after open on Wednesday, but staged a modest recovery within the half hour.

But it failed to build on momentum gained from Tuesday’s session, where the ASX posted a remarkable turnaround from the previous day’s $64 billion plunge.

“Volatility will remain in this market,” said Macquarie Private Wealth division director Lucinda Chan.

“It’s a very difficult time for investors given the amount of volatility we’ve seen in the last few days since the rout started in China from the devaluation of the currency.”

The resources sector was in positive territory, led by BHP Billiton, whose shares were up 38 cents to $23.72 after it increased its full year dividend despite a dive in net profit.

Rio Tinto gained 14 cents to $48.59 and Fortescue Metals rose half a cent to $1.82.

The big banks were a weak point for the ASX. NAB was down 23 cents to $30.86, Commonwealth Bank lost 21 cents to 74.87, ANZ fell 28 cents to $27.71 and Westpac was weaker 24 cents to $30.66.

“Everyone is just sitting back to see how things stabilise,” Ms Chan said.

“The rout in the global markets is taking precedence over earnings season and economic data that’s come out.”

In company news, Westfield was down two cents to $9.50 after reporting a half year net profit of around $466 million.

Seven Group Holdings posted an almost $360 million loss, with shares up six cents to $4.72.

Wall Street ends down after China rate cut fails to calm nerves

US stocks ended down on Tuesday after sharply reversing early gains late in the session as investors were unconvinced China’s move to cut to interest rates and banks’ reserve requirements could ease global growth concerns.

The US dollar also gave up much of its gains from earlier in the day. Wall Street trading was volatile and the S&P 500 ended down 1.4 percent after a late selloff following a gain of as much as 2.9 percent earlier in the day.

Global stocks, oil and currencies initially appeared to recover after markets were pummeled on Monday when Chinese shares fell almost 9 percent. Beijing heeded investor calls for intervention after the Shanghai Composite Index slumped again on Tuesday, but the index still ended down 7.6 percent.

After Monday’s Wall Street selloff – its steepest in four years – some investors bought on the dip. But others did not want to hold stocks overnight for fear of bad news from China.

“You didn’t have the snap back you would have expected to reverse a move like yesterday’s. People are still nervous about overseas and what might happen tonight. Nobody wants to sit around and see what happens,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. “Our fundamentals are not nearly as bad as those in China, so it would be logical to see us rally. But we’re still beholden to events in China.”

The Dow Jones industrial average fell 204.91 points, or 1.29 percent, to 15,666.44, the S&P 500 lost 25.59 points, or 1.35 percent, to 1,867.62 and the Nasdaq Composite dropped 19.76 points, or 0.44 percent, to 4,506.49.

Trading volume was high, with about 10.4 billion shares changing hands during the session, compared with the month-to-date average of 7.5 billion, according to BATS Global Markets. But it was lower than Monday’s 14 billion shares.

The CBOE Market Volatility Index, at 36, was still elevated, indicating significant uncertainty, though it was below the previous day’s peak of 53.3, which was the highest level since January 2009.

“You saw a knee-jerk drop and a knee-jerk recovery and now people are thinking about it,” said Brad McMillan, chief investment officer for Commonwealth Financial in Waltham, Mass.

Economists said Tuesday’s Chinese response – a 25-basis-point cut in key rates and 50 bps off the reserve requirement rate for large commercial banks – sent a clear signal that Beijing, which has stepped in several times this year to keep China’s growth on track, was still willing to intervene.

US Treasuries prices sagged as China’s lowering of interest rates and required bank reserves reduced some investor anxiety and sparked selling of US government bonds and other safe-haven assets.

The dollar index, which measures the greenback against a basket of major currencies, was up 0.8 percent at 94.1 in late afternoon after losing ground from its high of 94.7 earlier in the day.

MSCI’s benchmark emerging stocks index rose 2.2  percent, its biggest jump in just over two years after seven days of back-to-back falls. The MSCI all world stock index was down 0.12 percent.

The pan-European FTSEurofirst 300 index had its biggest one-day gain in almost four years, recouping much of the previous day’s loss when around 450 billion euros ($520 billion) was wiped off the FTSEurofirst 300’s value.

Oil rose but global oversupply and worries over the severity of the slowdown in China kept prices near the 6-1/2-year lows they fell to on Monday. US crude futures settled up 2.8 percent at $39.31 per barrel, while Brent ended up 1.2 percent at $43.21.

Copper, often considered a proxy for global economic activity, rose 2.3 percent.

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