Pre-Open Data
Key Data for the Week
Australian Market
The Australian sharemarket lifted 0.4% on Monday in a mixed session of trade. The Materials sector was the strongest performer, up 1.6%, followed by the Consumer Discretionary and Energy sectors. Market decliners were the Information Technology and Health Care sectors, down 1.1% and 0.8% respectively.
The Materials sector enjoyed strong gains yesterday as the iron ore price climbed 1.7%. Rio Tinto and BHP rallied 2.9% and 2.4% respectively, while Fortescue Metals rose 0.5%. Gold miners were also stronger; Newcrest Mining added 2.7% and Evolution Mining lifted 1.8%, while Northern Star closed 0.3% higher.
The Financials sector rose 0.5%, with mixed performances amongst the major banks. Commonwealth Bank lifted 1.0% and NAB added 0.2%, while Westpac and ANZ fell 0.5% and 0.4% respectively. Asset managers were also mixed; Challenger rose 1.3% and Australian Ethical Investment lifted 0.3%, while Magellan Financial Group slipped 0.7%.
The Health Care sector finished weaker; biotechnology heavyweight CSL fell 1.0% and Sonic Healthcare slipped 0.9%, while Ramsey Health Care closed down 0.6%. Recce Pharmaceutical climbed 4.1% after the company announced it will soon begin trading on Germany’s Frankfurt Stock Exchange.
The Australian futures market points to a 0.75% rise today.
Overseas Markets
European sharemarkets advanced on Monday. The Financials sector climbed 3.7% to reach a new one-year high. Lloyds Bank jumped 4.5% and Europe’s largest bank HSBC gained 4.1%, while Barclays lifted 3.7%. Automakers also outperformed; Volkswagen Group rose 1.2% and Bayerische Motoren Werke AG (BMW) climbed 5.3%. Renewable energy stocks closed stronger; Vestas Wind Systems added 2.3% and Siemens Gamesa gained 2.0%.
By the close of trade, the UK FTSE 100 rose 1.3% and the broad based STOXX Europe 600 gained 2.1%, while the German DAX rallied 3.3%.
US sharemarkets were mixed overnight. Travel and leisure stocks saw strong gains; American Airlines jumped 5.0% and United Airlines rallied 7.0%. The Information Technology sector extended losses; NVIDIA lost 7.0% and Spotify gave up 6.0%, while Apple and Alphabet fell 4.2% and 4.0% respectively. The Financials sector closed 1.3% higher; Citigroup rose 2.8% and Goldman Sachs added 2.1%, while JP Morgan Chase lifted 1.3%. Financial Services were mixed; MasterCard and Visa gained 2.9% and 2.3% respectively, while PayPal shed 5.4%.
By the close of trade, the Dow Jones closed 1.0% higher, while the S&P 500 and NASDAQ lost 0.5% and 2.4% respectively.
CNIS Perspective
Last Friday’s US employment data had widespread implications for financial markets, notably the AUD/USD exchange rate.
The unemployment rate fell 0.1% to 6.2% in February, which continues to reflect a significant improvement from the pandemic high of 14.8%.
Importantly, the employment data suggests there will not be a need for additional economic stimulus that would ultimately further weaken the USD.
Given it’s unlikely there will be any movement in interest rates in either the US or Australia, and with the iron ore price expected to stabilise, or even fall, as Brazil re-enters the iron ore supply chain, the absence of any further stimulus should continue to weaken the AUD against the USD.
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