Morning Market Update - 5 April 2019

Pre-Open Data

 International Markets vs Australian Market

Key Data for the Week

Key economic data released this week:

  • Thursday – US – Initial Jobless Claims fell 10,000, to 202,000, for the week ending March 30, the lowest in 49 years.
  • Friday – US – Unemployment Rate

S&P ASX 200 Last 12 Months

Australian Market

The Australian sharemarket fell 0.8% yesterday, after it reached a seven month high on Wednesday. Selling was broad based, with all sectors closing lower. The Energy sector led the declines; Woodside and Santos fell 2.1% and 2.2% respectively, while Beach Energy declined 4.3%.

The Health Care sector was amongst the worst performers; ResMed fell 2.7%, Cochlear lost 2.1%, and CSL slipped 1.5%. Materials retreated following recent iron ore driven gains; BHP and Fortescue Metals both declined 1.2% and Rio Tinto lost 0.7%. 

GrainCorp gained 2.2% after announcing the demerger of its malt business. The transaction is expected to be completed by the end of 2019 and will result in two separate ASX listed companies, GrainCorp and MaltCo. The initiative will allow for the acceleration of a number of cost reduction initiatives.

The Financials sector closed lower. The big four banks all declined 0.2% – 0.7%, with NAB leading the losses. 

The Australian futures market points to a 0.14% fall today.

Overseas Markets

European sharemarkets were mixed on Thursday. The broad based STOXX Europe 600 fell 0.3% and the UK FTSE 100 lost 0.2%, while the German DAX rose 0.3%. 

US sharemarkets were also mixed overnight, as investors await news on US-China trade talks. Boeing rose 2.8% as investigations continue into the fatal crash of an Ethiopian Airlines jet. Boeing reportedly said "its software fix for its anti-stall system would give pilots the authority to always override the system if activated by faulty sensor data". Tesla fell 8.2% on news that deliveries of electric vehicles fell 31% in the first quarter.  By the close of trade, the Dow Jones rose 0.6% and the S&P 500 added 0.2%, while the NASDAQ fell 0.1%. 

CNIS Perspective

While the fall in global equity markets in the last quarter of 2018 was certainly challenging for investors, the rapid recovery in the first quarter of 2019 has been rewarding. 

Despite all the initial doom and gloom during the final quarter of 2018, the first quarter of 2019 will be remembered as one of the strongest quarters post GFC. It is already being dubbed as one of the most memorable on record, given the sheer broadness of positive returns across asset classes. 

As can be seen in the chart below, showing total returns for the March quarter in local currency terms, 37 of the 38 asset classes finished in positive return territory.

The scale of returns has been impressive, as well as the breadth. 11 assets ended the quarter with double-digit returns, the most since Q1 2012. Picking out some of the highlights at an asset level, this was the best quarter for; 

  • Oil (+32.4%) and the S&P 500 (+13.6%) since Q2 2009.
  • US high-yield bonds (+7.5%) since Q4 2011.
  • China’s Shanghai Composite (+23.9%) since Q4 2014.
  • Europe’s STOXX 600 (+13.3%) since Q1 2015.

Total Return Performance of Majopr Global Financial Assets in Q1

Should you wish to discuss this or any other investment related matter, please contact your Investment Services Team on (02) 4928 8500.


The material contained in this publication is in the nature of general comment only, and neither purports, nor is intended to be advice on any particular matter.  Persons should not act or rely upon any information contained in or implied by this publication without seeking appropriate professional advice which relates specifically to his/her particular circumstances.  Cutcher & Neale Investment Services Pty Limited expressly disclaim all and any liability to any person, whether a client of Cutcher & Neale Investment Services Pty Limited or not, who acts or fails to act as a consequence of reliance upon the whole or any part of this publication. Cutcher & Neale Investment Services Pty Limited ABN 38 107 536 783 is a Corporate Authorised Representative of Cutcher & Neale Financial Services Pty Ltd ABN 22 160 682 879 AFSL 433814


Topics: CNIS, Dow Jones, Australian Market, ASX, international markets

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