Stocks in Australia slip ahead of Royal Commission report

FAN Editor

Stocks in Australia traded lower during Monday morning trade ahead of the release of a landmark report surrounding the country’s beleaguered financial services sector.

The ASX 200 slipped 0.21 percent in early trade, with the sectors mixed. The heavily weighted financial subindex declined more than 0.5 percent as shares of the country’s Big Four banks declined.

The moves Down Under came ahead of the release of the final report by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. The recommendations by the Royal Commission are expected to bring extensive changes to Australia’s banking sector, following series of systemic wrongdoings which were uncovered in 2018.

Meanwhile, futures pointed to a lower open for Japan’s Nikkei 225. The Nikkei futures contract in Chicago was at 20,770, as compared to the benchmark index’s last close at 20,788.39.

Stock markets in China and South Korea are closed today due to holidays.

The Dow Jones Industrial Average posted slight gains on Friday after the U.S. government released jobs growth data that easily beat expectations. The U.S. economy added 304,000 jobs in January, according to data released by the Bureau of Labor Statistics. Economists polled by Refinitiv expect the U.S. economy to have added 170,000 jobs in January.

The 30-stock Dow rose 64.22 points to 25,063.89, its sixth straight week of gains and its longest since November 2017. The S&P 500 closed 0.1 percent higher at 2,706.53 as gains in the energy and tech sectors offset losses in consumer discretionary. The Nasdaq Composite declined 0.25 percent to 7,263.87 as Amazon shares fell.

China’s services sector continued to see steady growth in January despite dipping slightly from December levels, according to a private survey which was released on Sunday.

The Caixin/Markit services purchasing managers’ index (PMI) fell slightly to 53.6 in January from 53.9 in December, but well above the 50.0 mark separating growth from contraction.

The Chinese services PMI numbers were “not nearly as grim” as their manufacturing counterparts, Ray Attrill, head of foreign exchange strategy at National Australia Bank, said in a morning note.

Nevertheless, Attrill said the slip of the composite manufacturing and services PMI number from 52.2 to 50.9 meant there was “no let up here as yet from China growth slowdown concerns.”

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 95.604 after seeing lows below 95.4 last week.

The Japanese yen traded at 109.47 against the dollar after touching highs below 108.8 in the previous trading week. The Australian dollar changed hands at $0.7245 after seeing lows below $0.715 last week.

— CNBC’s Fred Imbert and Reuters contributed to this report.

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