Morning Market Update - 8 March 2018

Pre-Open Data


Key Data for the Week

Key economic data released this week:

  • Wednesday – AUS – Gross Domestic Product rose by a smaller than expected 0.4% in the December quarter, following upwardly revised growth of 0.7% in the September quarter. Annual GDP growth slowed to 2.4%.
  • Wednesday – EUR – Gross Domestic Product grew 0.6%, following the 0.7% expansion seen in the third quarter.
  • Thursday – EUR – ECB Interest Rate Decision
  • Thursday – US – Initial Jobless Claims

Australian Market


The ASX finished lower in Wednesday trading, with the benchmark ASX 200 index closing down 1.01%.

All sectors finished lower, with Consumer Staples and Energy the worst affected. Woolworths lost 1.40%, Wesfarmers dropped 1.50% and AGL gave up 1.76%.

Heavyweight miners BHP and RIO also finished the day lower, falling 1.01% and 0.99% respectively.

Amongst the big four banks, Westpac was the worst performer, falling 1.6%, ANZ and NAB each fell 1.3% and Commonwealth Bank ended 0.7% lower.

The Australian futures market points to a 0.41% rise today.

Overseas Market 

US equities ended mixed on Wednesday night, after rebounding well off session lows in a volatile day of trade, following the resignation of Gary Cohn as Trump’s top economic adviser. Energy, Consumer and Utilities were among the worst performing sectors, while the Health Care, REITs and Information Technology sectors saw solid gains. The Dow Jones fell 0.33%, the S&P 500 gave up 0.05% and the NASDAQ gained 0.33%.

Markets rallied in Europe overnight with Germany’s DAX the best performer, up 1.09%, whilst France’s CAC 40 and the UK’s FTSE 100 rallied 0.34% and 0.16% respectively.

CNIS Perspective 

On the surface of it, Australia’s GDP for the December quarter, which was released yesterday, was a pretty ordinary outcome, with the annual GDP growth rate of 2.40% below the 20 year average of 3.10%.

However, in a case where a cloud has a silver lining, the weak GDP number had some underlying positives to it. Most notably in the December quarter, was the increase in household consumption, which showed a healthy growth of 1%. Surprisingly, the lift in household spending came entirely from growth in household income.

Whether this can be expected to continue is already in doubt. As we discussed in Tuesday’s Morning Market Update, January’s retail sales reflected a fragile consumer with weak retail sales, which indicates the March quarter is already off to a lacklustre start.

For the time being, the focus will probably be on the positive sign of higher household spending in yesterday’s data.

It’s been a weakness for so long.


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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: Investment, CNIS, GDP

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