The S&P/ASX 200 closed lower on Monday, down 11.80 points or 0.16% to 7,292.20. Magellan Financial Group dropped as much as 33% after British wealth manager St James's Place terminated a mandate with Magellan that was worth 12 per cent of the group's current annual revenue, or around $18.6 billion. It comes less than a fortnight after the unexpected departure of Magellan's chief executive.
CIMIC Group was down 13%.
Markets in Hong Kong, Singapore and China are all lower. US futures are sinking and Brent and WTI crude oil futures are down more than 2%.
Rio has new chair
Mining giant Rio Tinto has selected Canadian Dominic Barton as chairman. He will join the board on April 4 and be appointed to the role of chair at the conclusion of its annual general meeting on May 5. He replaces Simon Thompson. Shares were slightly up by the close of trade.
Covid cases rising
Travel related stock and biotechnology shares are reacting as covid case numbers rise globally. There's interest in Pfizer, AstraZeneca, and on the ASX, CSL gained, while Qantas, Corporate Travel Management, Webjet and Flight Centre were all lower by the close.
On Tuesday at 11.30am AEDT, the Reserve Bank of Australia will release the minutes of its December board meeting. The RBA does not meet again until February 2022.
ETFs go wild
New industry research shows that over 1.73 million Australians now invest in ETFs with an additional 275,000 Australians expected to invest for the first time in 2022 – which would be the biggest influx of first-time investors on record, according to BetaShares.
The BetaShares/Investment Trends ETF Report 2021 also shows that 1.46 million existing ETF investors (84%) intend to increase their allocation to ETFs in the next 12 months – the highest rate since 2013.
“The data confirms that ETFs are increasingly the investment vehicle of choice for both experienced and first-time Australian investors seeking to build their wealth," said BetaShares CEO Alex Vynokur.
The benchmark Dow Jones Industrial Average fell 1.5 per cent to close at 35,365.44, and the broad-based S&P 500 fell 1.0 per cent to end at 4,620.64. The tech-rich Nasdaq Composite Index, which was in positive territory much of the day, ended with a 0.1 per cent lost to finish at 15,169.68.
Electric car maker Rivian fell 10.3 per cent after announcing a big quarterly loss following the market close Thursday, and saying production might fall “a few hundred vehicles short” of the 2021 target of 1,200 cars.
JPMorgan closed 2.3 per cent lower after being hit with $US200m in fines after admitting to “widespread” record keeping violations including use of unapproved messaging apps and failing to preserve communications.
Fed Governor Christopher Waller said policymakers now have the ability to respond quickly with an increase in the benchmark lending rate, which he expects “will be warranted shortly after our asset purchases end” in the spring.
Asked to be more precise about the timing, Waller said, “We’d like to put March on the table as a possible date to start lifting (interest rates) if we need to.” Quarterly forecasts from Fed policymakers also released this week signalled the likelihood of three interest rate hikes next year, and most economists expect the first one in May as officials try to keep inflation under wraps.
But opening the door to a more rapid move in March — at what would be the Fed’s second policy meeting of the year — was the “whole point” of the decision announced this week, Waller told the Forecasters Club of New York.
Hopes of a recovery in Chinese demand have pushed iron ore prices higher. In a note late last week, Fitch Solutions said it was “neutral” on the price of iron ore short-term though it expects it to trend lower through 2022 to average $US90 a tonne for the year.
Separately, Morgan Stanley lifted its iron ore price target by 5 per cent to $US100 a tonne as it sees a tighter market in 2022. It also lifted its the long term nominal price by 19 per cent to $US75 a tonne.
*ASX trading schedule: The exchange will close at 2pm on Friday and it will be closed on both Monday December 27 and Tuesday December 28.
*Wall Street trading schedule: The NYSE will be closed on Friday December 24.