Pre-Open Data
Key Data for the Week
- Tuesday – AUS – RBA Meeting Minutes
- Wednesday – EUR – Trade Balance
- Thursday – EUR – Consumer Price Index
- Thursday – EUR – Consumer Confidence
- Friday – EUR – Markit Manufacturing
- Friday – UK – Retail Sales
- Friday – US - Markit Manufacturing
Australian Market
The Australian sharemarket added 0.6% on Thursday before the Easter long weekend, as increases in the price of oil and iron ore helped the index higher.
The Materials sector was the best performer on the market, as the price of iron ore returned to US$150 per tonne. As a result, BHP added 1.4%, Fortescue Metals rose 1.3% and Rio Tinto eked out a less than 0.1% gain. Gold miners enjoyed gains; Northern Star Resources jumped 4.2%, while Evolution Mining closed the session 2.4% higher.
Woodside Petroleum and Santos both added 1.1%, as the Energy sector rose 1.1% and comes as the price of oil increased to US$107 per barrel. The increased COVID lockdowns across China is the main reason for the increased prices, as investors fear the lockdowns could further affect depleted supply chains.
Strong gains were seen across the Travel and Leisure sector, led by Qantas which lifted 7.1%. This comes as a result of US airline, Delta Air, claiming they had seen strong demand which could combat increased oil costs. Flight Centre and Webjet also increased, up 5.0% and 7.5% respectively.
The Australian futures market points to a 0.13% gain today.
Overseas Markets
European sharemarkets closed higher on Thursday, boosted by the Travel and Leisure sector. International Consolidated Airlines added 3.7%, while Lufthansa rose 2.7%. The oil majors continued their recent strength; BP added 0.5% and Royal Dutch Shell increased 0.3%. By the close of trade, the UK’s FTSE 100 added 0.5% and the STOXX Europe 600 rose 0.7%, while the German DAX lifted 0.6%.
US sharemarkets lost ground overnight, as the Information Technology sector weighed on indices. PayPal dropped 1.7% and Netflix shed 1.0%, while Apple closed the session 0.1% lower. The Energy sector was the main outperformer, given the recent increase in oil prices. As a result, ConocoPhillips added 2.1% and Chevron Corporation lifted 1.3%.
By the close of trade, the Dow Jones and the NASDAQ both dropped 0.1%, while the S&P 500 closed the session relatively flat.
CNIS Perspective
Australia’s labour market continues to strengthen, with it adding nearly 18,000 new jobs in March.
Despite not being enough to lower the unemployment rate, which was stable at 4.0%, unemployment in Australia sits at its lowest level since the mid-1970’s and has added jobs for the last five consecutive months.
In addition, the underemployment rate, which includes people who are employed, but wish to work more hours, fell by 0.2%, to 6.3%. This is the lowest level of the underemployment rate since November 2008.
The Reserve Bank estimates the level of full employment being somewhere between the high 3’s and low 4’s. However, as the labour market continues to tighten, there is every chance we see the unemployment rate falling to below 3.5% over 2022.
As employers are finding it increasingly difficult to locate workers, coupled with an unemployment rate that is expected to fall further, this will ensure wage pressures are likely to build at an increasing rate throughout the rest of this year.
Should you wish to discuss this or any other investment related matter, please contact your Wealth Management Team on (02) 4928 8500.
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