The sharemarket that is Australian trading at its point that is lowest since June after renewed weakness on Wall Street.
The S&P/ASX200 Index is down 60.8 points, or 1 per cent, to 5847.7 points.
BHP is down 1.5 per cent, Commonwealth Bank is 1.4 per cent weaker, and Transurban has lost 1.4 per cent.
Rio Tinto is down 0.2 percent after the miner announced the exit of chief executive J-S Jacques and two senior professionals following the Gorge that is juukan debacle.
Technology stocks are weaker after the Nasdaq dropped 2 per cent starightaway. Afterpay is down 2.9 per cent, while Xero has shed 2.5 per cent.
5 mins ago – 2.17pm
Morgan Stanley downgrades Fortescue Metals Group to underweight
Morgan Stanley has downgraded its rating on Fortescue Metals Group to underweight, saying while iron ore prices had been expected to remain higher for longer, some valuations had run too high.
The broker increased its cost target on Fortescue from $12.70 to $14.50 but said its $17.89 price was implying the iron ore price would average $US107 a tonne through to 2025.
Morgan Stanley is forecasting 62 per cent iron ore would average $US63 a tonne by 2025. The sharemarket that is Australian trading at its point that is lowest since June.
“We expect elevated steel that is Chinese margins and low-grade iron ore discounts to continue in the future,” stated analyst Rahul Anand while we forecast iron ore prices to remain elevated through FY20-FY21.
“Should Chinese steel mill profitability be higher than expected, there may be downside that is further to our base situation valuation. With Fortescue pricing in iron ore >$US100 a tonne, we come across valuation being stretched and move underweight, and prefer BHP’s diversified commodity visibility.” These could be harbingers of a bleak future amid widening concerns of as pandemic resurgence.