Australia Market falls on material, consumer stocks

Headline indices of the Australia stock market were lower on Wednesday, 04 July 2018, reflecting in part mixed fortunes for US and European markets overnight, as traders fretted about the fallout of the intensifying trade frictions between Washington and the rest of the world. Most of ASX issues declined, with shares in consumer discretionary, consumer staples, financials, realty, energy, materials, and industrial issues being notable losers. Around late afternoon, the benchmark S&P/ASX 200 Index dropped 33.51 points or 0.5% to 6,176.70. The broader All Ordinaries Index was down 35.32 points or 0.6% to 6,267.50.

The uncertainty over trade policy was still hanging over markets. Many investors fear Washington will go ahead with its plan to impose tariffs on $34 billion worth of Chinese goods on July 6, which Beijing has vowed to match with tariffs on U.S. products, raising the risk of a full-blown trade war. The Trump administration was seen as keeping the U.S.-China tensions alive after late Monday saying it seeks to block China Mobile from operating in the U.S. market. The White House cited national security interests as the reason for refusing China Mobile access to the U.S.

CURRENCY NEWS: The Australian dollar advanced against greenback even though the trade surplus in May was lower than expected. Commodity exports helped deliver a surplus of $827 million for the month, short of a $1.2 billion consensus forecast. Exports rose by 4% in May, while imports increased by 3%. The AUD/USD traded near 0.7385 US cents.

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