Pre-Open Data
Key Data for the Week
Australian Market
The Australian sharemarket lifted on Friday to post gains in four out of the five trading sessions last week. Gains were led by the Energy sector, while the Information Technology and Materials sectors also contributed to last weeks rally.
The price of oil increased towards the end of the week, however, still remains lower on worries of decreasing demand. Beach Energy led the gains, up 4.3% and Santos rose 2.3%, while Woodside Energy closed the session 1.7% higher.
The Materials sector added 1.2% on Friday, as lithium providers and gold miners advanced. Pilbara Minerals was the best performer of the lithium providers, up 6.8%, while Allkem added 5.2% and Mineral Resources rose 4.6%. St Barbara led the gains among the goldminers, up 9.6%, after the company announced it had met full year production guidance and increased their cash balance.
The Information Technology sector increased 0.8% to jump 6.9% over the week. As a result, Xero added 1.6% and Megaport lifted 3.3%, while WiseTech Global gained 0.3%.
The Australian futures market points to a 0.30% gain today, driven by stronger overseas markets.
Overseas Markets
European sharemarkets enjoyed gains on Friday. Automaker shares were the strongest performers, up 3.3%, as BMW added 1.7% and Porsche jumped 6.1%. The Travel & Leisure sector also posted gains; easyJet added 1.1% and Lufthansa rose 0.6%. By the close of trade, the STOXX Europe 600 lifted 0.5% and the UK’s FTSE 100 gained 0.1%, while the German DAX rose 1.3%.
US sharemarkets were slightly lower on Friday, however, were higher over the week. The Information Technology sector was mixed; Netflix and Amazon shed 1.2% and 0.7% respectively, while Alphabet added 0.7%. By the close of trade, the Dow Jones slipped 0.2% and the S&P 500 dropped 0.1%, while the NASDAQ gained 0.1%.
CNIS Perspective
Soaring food prices, triggered in part by Russia’s invasion of Ukraine, have been one of the most impactful reasons for the cost of living spike this year.
However, there are signs the wave may now be easing in a positive sign for inflation data ahead, as global food prices fell 2.3% in the month of June.
Crop prices have eased considerably, thanks partly to better growing weather conditions in North America, Europe and Asia, which has led to larger crop yields, along with higher exports from Russia.
Corn, wheat and soybean futures are all currently trading lower than they were just before Russia attacked Ukraine, despite Russia continuing to block Ukraine’s primary export route through the Black Sea. This is incredible, considering Ukraine makes up 6% of global food production, including 16% of global corn exports and 12% of wheat produce.
Despite the monthly decline, the June food index was still 23.1% higher than a year earlier, but these signs are a significant improvement.
If the decline is persistent, there are expectations this may lead to a halving in global food inflation, from a 13% annual rate in the second quarter, to 5.5%-6% by the end of 2022.
This alone could offer a 1.5% easing in the Consumer Price Index.
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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