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Australian shares tipped to fall early

Australian money background. Fifty dollar notes.

Shares are expected to fall early on the Australian market after US markets last momentum late in the session.

The Australian SPI 200 futures contract was lower by 65.0 points, or 1.06 per cent, to 6073.0 points at 0800 AEST on Wednesday.

Overnight, US markets markets rallied on news of the European Union reaching agreement on a massive US$857 billion coronavirus recovery fund, which boosted hopes for similar stimulus measures in Washington to sustain economic recovery.

But the march upward lost steam late in the session, amid a drop in technology shares.

The Dow Jones Industrial Average ended 0.6 per cent higher to 26,840.4, the S&P 500 gained 0.17 per cent, to 3,257.3 while the Nasdaq Composite dropped 0.81 per cent, to 10,680.36.

Oil prices rose about US$1 a barrel after the European deal, with Brent crude futures settling at US$44.32 barrel.

In Australia today, preliminary retail sales figures for June will be released.

Local investors may be inclined to book some profits after the share market on Tuesday closed at its best level since before the pandemic.

The benchmark S&P/ASX200 index closed up 154.7 points, or 2.58 per cent, at 6,156.3 points, while the All Ordinaries index gained 156.5 points, or 2.56 per cent, at 6,268.8.

The Australian dollar surged as risk appetite returned on stimulus hopes globally. It was trading at 71.33 US cents at 0800 AEST, sharply higher from 70.38 US cents at Tuesday’s close.

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