ASX to slide after Trump abandons stimulus talks
Summary
- S&P500 closes 1.4% lower, dropping sharply in final hour, after Donald Trump halts negotiations on a highly anticipated stimulus bill
- Futures point to a 0.3% decline on the ASX when the market opens
- Gold drops 1.5% to one-week low of $US1,884 per ounce
- Two of Australia’s largest super funds are set to vote against a shareholder proposal to bring forward the closure of AGL’s coal-fired Loy Yang power plant in Victoria, despite bolstering their climate policies this year
Latest updates
Wall Street wrap: Disbelief as Trump abandons stimulus talks
By Doina Chiacu and Richard Cowan
Markets plunged after US President Donald Trump on Tuesday called off negotiations with Democratic lawmakers on coronavirus relief legislation until after the election, even as cases of the virus are on the rise across much of the country before flu season.
“I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business,” Trump wrote on Twitter a day after emerging from a hospital stay for COVID-19 treatment.
Following Trump’s announcement, US stocks reversed course to close lower.
The S&P500 dropped from a session high of 3,429 points at 2.45pm New York time to close at 3,360 points, a one day decline of 1.4 per cent. The Nasdaq closed 1.6 per cent lower after also reaching a session high at 2.45pm.
US House of Representatives Speaker Nancy Pelosi said Trump’s decision to pull the plug on negotiations showed that the White House was in “complete disarray.”
Trump’s surprise move came after Pelosi on Sunday said during an interview with NBC’s “Face the Nation” that progress was being made in her negotiations with the Trump administration on a bill to build on the more than $US3 trillion in coronavirus aid enacted into law earlier this year.
Earlier on Tuesday, Federal Reserve Chair Jerome Powell told a business conference the US economic expansion was “far from complete” following the deep contraction stemming from the pandemic.
A failure by the United States to provide further relief, Powell warned, “would lead to a weak recovery, creating unnecessary hardship for households and businesses.”
Reuters
Good Morning
Good Morning, and welcome to today’s Markets Live blog.
There is much to digest today in the wake of yesterday’s federal budget, as well as overnight ructions in the US.
Alex Druce and Lucy Battersby will steer you through all the noise.
This blog is not intended as financial advice.
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