Pre-Open Data
Key Data for the Week
Australian Market
The Australian sharemarket added 1.0% yesterday, as the index rebounded to snap a three-day losing streak. The US declared a ban on Russian oil imports, while the European leaders will reduce gas imports this year.
The Information Technology lifted 3.2% and was the best performer on the market. Buy-now-pay-later providers, Block and Zip, added 5.9% and 1.2% respectively. Accounting software provider, Xero, lifted 1.8%, while WiseTech Global rose 6.4%.
The major miners were mixed; however, the Materials sector closed the trading day up 0.6%. Mineral Resources added 2.6%, Fortescue Metals lifted 0.9%, while BHP closed the session relatively flat, and Rio Tinto lost 0.5%. Nickel Mines entered a trading halt after the company lost approximately 22% upon open as it was revealed that major shareholder, Tsingshan Group, had a short position on nickel. However, shares rebounded to close down 4.8% after the company reassured shareholders they would not sell any shares.
The Energy sector added 0.1%, as the price of Brent crude oil reached US$130.65 per barrel. Origin Energy added 1.4%, after the company announced they will run a $250 million on-market share buy-back in April.
The Australian futures market points to a 0.34% rise today, driven by stronger overseas markets.
Overseas Markets
European sharemarkets enjoyed broad-based gains on Wednesday. The Financials sector was among the best performers, as Deutsche Bank added 7.5% and Barclays lifted 5.4%. Auto-maker stocks also rose; Bayerische Motoren Werke (BMW) soared 7.3%, while Volkswagen Group jumped 10.7%. By the close of trade, the STOXX Europe 600 added 4.2% and the UK’s FTSE 100 lifted 3.3%, while the German DAX closed the session 7.9% higher.
US sharemarkets also rose overnight, as most sectors saw gains. The big tech providers helped the indices higher; Alphabet added 5.2%, Netflix rose 5.0% and Microsoft lifted 4.6%. The Financials sector closed higher, as Wells Fargo added 5.8% and Goldman Sachs was up 3.8%. By the close of trade, the Dow Jones added 2.0%, while the S&P 500 and NASDAQ lifted 2.6% and 3.6% respectively.
CNIS Perspective
The convergence of domestic natural disasters, conflict between Russia and Ukraine, emerging inflationary pressures and rising interest rates has certainly seen Australian consumer sentiment take a dive.
Consumer sentiment, as measured by Westpac and the Melbourne Institute, fell 4.2% to 96.6 in March, which is the lowest reading since September 2020.
Notably, it is the first time since then that the survey has fallen below 100 – indicating that the pessimists outweigh the optimists.
Spending is still expected to continue at a solid growth rate this year, given the pent-up demand evident in household savings.
However, cost of living pressures and higher interest rates will be headwinds for consumption on top of the recent floods and developments in Ukraine, casting additional uncertainty over the outlook.
Financial markets don’t like uncertainty, and this is one of the most uncertain times in recent memory.
Clarity is needed, particularly with regards to Russia and Ukraine.
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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