Published: Sat, October 27, 2018
Money | By Hannah Jacobs

Australian share market rebounds, but only regains a fraction of yesterday's losses

Australian share market rebounds, but only regains a fraction of yesterday's losses

Thursday's tumble follows a fall by USA stocks overnight, which confirmed a correction too for the Nasdaq and erased the Dow and S&P 500's gains for the year amid disappointing earnings, economic growth concerns, a spat between Italy and the European Union and the killing of a Saudi journalist. The Nasdaq composite gave up 329 points, or 4.4 per cent, to 7,108.

A screen displays a chart of the Dow Jones Industrial Average on the floor of the New York Stock Exchange (NYSE) in New York, U.S., October 24, 2018.

The Australian share market has tumbled to its lowest level in 12 months, with the indices suffering significant losses across the board after a dive on Wall Street overnight.

Technology companies, health care and energy stocks also accounted for much of the slide on Wall Street, which followed a steep sell-off in Chinese and other global markets.

"It looks like more panic and fear as the selling has continued to roll", said Chris Zaccarelli, Chief Investment Officer for Independent Advisor Alliance based in Charlotte, North Carolina.

The S&P-ASX 200 index opened just 0.7 per cent higher despite index futures pointing to a 1.3 per cent gain, but selling soon knocked it to a 0.7 per cent loss.

High-flying companies like Netflix and Amazon took some of the biggest losses Wednesday.

"Investor sentiment remains cautious as we anticipate the reports of over 100 S&P 500 companies including Amazon (AMZN.O), Alphabet (GOOGL.O) and Comcast (CMCSA.O)".

AT&T sank after reporting weak subscriber numbers, and chipmaker Texas Instruments fell 8.2 per cent after reporting slumping demand.

The Dow fell 2.41 percent and the S&P 500 lost 3.09 percent.

"The sentiment and the outlook seems to be turning more negative, or at the very least, less rosy".

Shares of Qantas Airways fell nearly 4% after the company eported a 6.3% increase in first-quarter revenue, reflecting a jump in forward bookings and higher airfares that helped offset rising fuel costs.

Recent signs that the housing market is slowing are fuelling speculation that USA economic growth will start to slow next year.

Twitter rose 18.6 percent after strong ad sales boosted third-quarter profit, while Comcast gained 18.6 percent after the media company's quarterly results beat Wall Street estimates. Treasurys also got a bid on Wednesday with the yield on the 10-year moving back to 3.11% and the 5-year falling back below 3% after yields earlier this month hit a seven-year high.

AT&T was among the big decliners in the media and communications sector, dropping 8.1 per cent to United States dollars 30.36 after the communication giant's latest quarterly results fell short of Wall Street's expectations.

ENERGY: Crude oil prices were headed higher Wednesday, clawing back part of a sharp decline a day earlier.

CURRENCIES: The dollar weakened to 112.42 yen from 112.47 yen on Tuesday.

The December crude contract was down US$1.95 at US$67.41 per barrel and the November natural gas contract was up 8.2 cents at US$3.22 per mmBTU. Apple fell 1.6 percent.

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