Pre-Open Data
Key Data for the Week
Key economic data released this week:
Australian Market
The Australian sharemarket eked out a 0.01% gain yesterday in a mixed session of trade. The local market was held up by heavyweights CSL and Fortescue Metals after they both released earnings updates; CSL rose 2.8% after the company announced a 45% rise in NPAT to US$1.8 billion and Fortescue Metals added 1.9% as it posted a 66% lift in 1HFY20 earnings to US$4.1 billion on the back or high iron ore prices. The miner also announced it will pay a $1.47 fully franked dividend, a 93% rise on the previous payout.
The REITs sector was amongst the weakest performers; GPT Group, Scentre Group and Stockland Corporation all fell between 1.6% and 2.4%. The Energy sector also underperformed, with Woodside Petroleum and AGL down 2.4% and 2.0% respectively.
Consumer Staples were mostly lower; Coles dropped 5.6% to continue its weakness since it announced on Wednesday and Woolworths fell 0.5%. Wesfarmers bucked the trend to rise 0.6% after it reported a 15% increase in first half profit.
The big four banks were mixed; Westpac lifted 3.5% and ANZ added 2.8%, while Commonwealth Bank and NAB fell 0.8% and 0.3% respectively.
The Australian futures market points to a 0.51% fall today, driven by weaker overseas markets overnight.
Overseas Markets
European sharemarkets closed lower on Thursday, to record a third straight session of losses, as the broad based STOXX Europe 600 fell 0.8%. Barclays slipped 4.4% despite its earnings release above consensus and the announcement it plans to commence a share buyback of up to £700 million.
US sharemarkets were also weaker overnight, as attention remains on increased inflation and rising bond yields. The Energy sector was the weakest performer, while consumer stocks outperformed. By the close of trade, the Dow Jones and S&P 500 lost 0.4%, while the NASDAQ fell 0.7%.
CNIS Perspective
The Australian unemployment rate fell to 6.4% in January, down from 6.6% in December and is a further encouraging sign of the recovery we are seeing in the domestic economy.
Significant monetary and fiscal stimulus measures have underpinned the resilience of not only the labour market, but the broader domestic economy following the onset of the COVID-19 pandemic last year.
This includes the JobKeeper wage subsidy program, which helped limit the unemployment rate to 7.5% at its peak.
Further, the boost in consumer confidence over the past several months has encouraged cashed up households to spend, which in turn has prompted businesses to resume hiring.
While there is some uncertainty regarding how the conclusion of JobKeeper at the end of March may impact the labour market, consensus expectations are for a continued recovery in the unemployment rate over the course of 2021 and 2022, as the broader economy continues to recover and strengthen.
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