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ASX Today: ASX caps off worst week since GFC with more losses

A strong trading week looks set for a lacklustre conclusion after European shares closed little changed on low volumes while US traders celebrated Thanksgiving.

ASX SPI200 index futures eased 15 points or 0.2 per cent, signalling a mildly negative start here following yesterday's slide. The S&P/ASX 200 dropped 0.7 per cent yesterday to its largest loss of the month. Despite the setback, the index was 1.5 per cent ahead for the week.

What moved the market

European markets marked time as the US holiday gave investors a chance to catch their breath after a breakneck month. The Stoxx 600 dipped 0.12 per cent. The pan-European index has put on 13.5 per cent this month and is on track for its best month on record.  

“The global rally seems to have paused for now,” Hussein Sayed, chief market strategist at trading firm FXTM, said.

Germany's DAX closed flat despite news coronavirus restrictions will be extended until at least December 20 to contain the latest wave of infections. Britain's FTSE 100 was among the worst performers with a loss of 0.44 per cent after Finance Minister Rishi Sunak warned the UK economy will shrink by 11.3 per cent this year.

Shares in AstraZeneca slid 0.7 per cent in London after US sources raised doubts about the efficacy of its Covid-19 vaccine. The company defended trial results and signalled it may run an additional trial to test lower dosages.

Bitcoin tumbled more than 15 per cent in 24 hours after rising to its highest level in three years. The volatile cryptocurrency was lately down 11.3 per cent at US$16,733 after trading as high as US$19,488 and as low as US$16,327.

Australian outlook

The global money-go-round began to slow on Wednesday as Wall Street wound down for Thanksgiving. ASX trading volumes fell from around 1.2 billion trades on Wednesday to 800 million yesterday - not the lowest of the week, but below the recent average.

Barring black swans, today looks likely to be another subdued session. The ASX 200 suffered a flesh wound yesterday, but the 0.7 per cent fall barely made a dent in the phenomenal returns from a month of near-vertical gains. The index has put on almost 12 per cent during November, a record return.

Commodity price movements (see below for more) over the last 24 hours were generally favourable. Iron ore up, industrial metals up, gold up. Oil was the only negative.

AGM season is winding down. Today brings updates from Sandfire Resources, Helloworld Travel, Karoon Gas, Omni Bridgeway and QANTM Intellectual Property. Earnings are due from Thorn Group.

The dollar drifted 0.02 per cent lower to 73.62 US cents.

Commodities

Iron ore closed just short of US$130 a tonne on strong demand from Chinese steelmakers. The spot price for ore landed in China improved $1.80 or 1.4 per cent to US$129.95 a tonne. BHP and Rio Tinto fell during a generally negative session on the London Stock Exchange. BHP's UK-listed stock shed 1.56 per cent. Rio Tinto lost 0.35 per cent.

The mood was brighter on the London Metal Exchange. Copper hit its highest level in almost seven years, extending a recovery that has lifted prices 70 per cent since the March lows. Benchmark copper advanced 1.4 per cent to US$7,387 a tonne. Aluminium gained 0.4 per cent, nickel 1.3 per cent, lead 0.3 per cent, zinc 0.2 per cent and tin 0.4 per cent.

Oil eased from eight-month highs following signs of internal dissent within the OPEC+ trading cartel. US crude futures were lately down $1.24 or 2.7 per cent at US$44.47 a barrel. Brent crude slid 1.7 per cent to US47.76.

Gold continued to hold just above technical support at US$1,800 an ounce. Gold for December delivery was lately ahead $3.10 or 0.2 per cent at US$1,808.60 an ounce.


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