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ASX lower, beer shortage looms, MS ups Fed call

beer in a glass on a wooden table

The S&P/ASX 200 closed lower on Friday, dropping 31.00 points or 0.4% to 7353.50 and crossing below its 50-day moving average.

Afterpay closed 4.4% lower and Whitehaven Coal was down 4%. Over the last five days, the index has gained 1.55%.

Despite the weekly gain, investors appear concerned about the potential impact of the latest covid variant, omicron, and are also awaiting US inflation data scheduled for release later.

Locally, beer is being rationed across BWS bottle shops as Australia’s two largest brewers face delivery delays and shortages coming into Christmas, The Australian reports.

Lion and Carlton & United Breweries have both issued warnings to customers and sales reps about pending “stock challenges” with limits in place at BWS shops for beers such as VB, Pure Blonde and Carlton Draught as the national liquor chain tries to secure supplies for the festive season.

One of the country’s most popular beers — Corona — which is imported from Mexico by CUB is suffering such “massive” supply issues, stores are restricted to order a maximum of 20 cartons each per week.

Westpac has amended certain key terms of its $3.5bn buyback due a fall in its share price. The price reduction gives the bank the opportunity to buy back more shares than was originally contemplated, but has implications for buy-back participants, the bank told investors on Friday.

Fortescue Metals Group chief executive Elizabeth Gaines will step down as the boss of the iron ore major in 2022 as the company looks for a “deeper management bench”, but will remain a Fortescue director.

Chairman and founder Andrew Forrest made the announcement in Sydney on Friday, saying Ms Gaines will assist with the search for a permanent new chief executive.

Wall Street snapped a three-day winning streak with investors cautious about the upcoming US November CPI data. The Dow Jones Industrial Average edged lower, the S&P 500 fell 0.71%, and Nasdaq slid 1.71%. The Russell 2000 declined 2%. 8 out of 11 sectors finished lower in S&P 500.

The Australian dollar appears to have found support at US70c and is sitting around US71.49c. US CPI data tonight will be a big one, with the current market consensus being an annual CPI rate of 6.8%, meaning any figure that comes out above this level could well lead to increased volatility across equity and bonds.

Morgan Stanley brought forward its call for the US Fed to raise rates from September 2022, with a second hike in December 2022. In 2023 Morgan Stanley expects a further three rate hikes. The investment bank also tips US 10-year treasury yields to offer 2.1% by the end of 2022.

Bitcoin lost support at $US50,000 and is down, trading around $US47,630..

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