Being the only American here at Boss Hunting, when I wake up each morning here in Sydney it’s about 4 am the previous day back in New York. The notifications from CNN, The New York Times and The Wall Street Journal have flooded my phone’s lock screen. In an effort to keep you updated as much as myself, I’ve decided to do a market debrief each week: from Wall Street to the ASX, and beyond. Because they’re all connected, even though right now we probably wish they weren’t.
Stocks Are Sliding After Wall Street’s Worst Day in 8 Months
A bull market can’t last forever. At this point, two-thirds of the US stock market has tumbled into a correction, signalling that the worst may be yet to come. At Wednesday’s close, 142 stocks in the S&P 500 had dropped 20% from recent peaks, officially putting them in a bear market. That’s a grand total 28% of the index. After suffering its steepest drop since February in the previous session, the Dow Jones industrial average closed down more than 2% and shed more than 1,300 points since even Tuesday.
The ASX200 fell below 6000 points and kept going to close down 2.7%
The Wall Street wave has a ripple effect. The ASX was initially rocked by the wave, sending the major banks, the big miners and tech stocks into a steep slide and dragging the ASX200 index below the key 6,000 point mark. Unfortunately, towards the end of the week, things aren’t looking too much brighter. Business Insider Australia began Friday by stating that “the ASX looks set for another sharp fall this morning after US stocks fell by another 2% overnight. Losses were led by energy and financial stocks, with smaller falls in the big tech companies”.
Indonesia’s Economic Stress May Be A Good Thing
Indonesia’s economy has been one of the hardest hit in Asia this year, with the currency slumping about 11% against the USD. However, Indonesia’s weakening currency could be a good thing. It is expected to spur the government to accelerate reforms, according to Thomas Lembong, chairman of the Investment Coordinating Board. The government will soon outline measures to open up the economy to more foreign investment. “I’m looking forward to a few breakthroughs, a few reforms that open up the economy further, even before the election,” Lembong said on Thursday at the Bloomberg Modern Markets Conference in Bali.
US Investment Firms Are Hesitant On Adopting AI
Artificial intelligence is a constant conversation topic these days, yet big US investment firms aren’t yet too willing to test it out. About 71% of US-based firms are not currently testing or considering how AI and advanced analytics can be applied to their investments, said a Fidelity survey of over 900 institutional investors published on Thursday. Ironically, a similar percentage of US investors agreed that AI will most likely augment humans’ traditional investment roles by 2025. A bit of a discrepancy.
Britain’s Democratic Unionist Party Threatens To Withdraw Support For The PM Over Her Controversial Brexit Plans
Just as it looked like British Prime Minister Theresa May was starting to make progress on a Brexit deal, her divided government threatens to fall apart. The Democratic Unionist Party is a small group of Northern Irish members of parliament who maintain May’s majority in the House of Commons. This group is not exactly enthused about new proposals that would mean increased border checks between Northern Ireland and the rest of the UK. The party has nine members of parliament in the Commons and reportedly plans to vote against May’s upcoming budget. This would be a massive humiliation for the British PM and could lead to calls for her resignation.