Pre-Open Data
Key Data for the Week
Australian Market
The Australian sharemarket eased 0.7% on Thursday, as most sectors closed weaker. Consumer Discretionary was the main laggard, down 1.3%, followed by Consumer Staples and Industrials, which fell 1.2% and 1.0% respectively.
The Materials sector was the strongest performer, lifted by strong gains in gold miners. Regis Resources climbed 8.1% and St Barbara added 5.6%, while Northern Star Resources and Newcrest Mining closed up 3.7% and 2.1% respectively. The mining heavyweights were mixed; BHP and Rio Tinto lost 0.7% and 0.6% respectively, while Fortescue Metals gained 1.1%.
Losses amongst the major banks weighed on the Financials sector; Commonwealth Bank fell 1.2% and NAB lost 0.7%, while ANZ slipped 0.4%. Westpac gave up 0.6% after the company confirmed the $725 million sale of its general insurance business to Allianz, while Bank of Queensland slipped 1.4% after the company completed the $1.3 billion acquisition of Members Equity (ME) Bank. Fund managers were mixed; Australian Ethical Investment fell 0.6%, while Magellan Financial Group gained 1.0%.
The Australian futures market points to a 0.35% rise today, driven by stronger overseas markets.
Overseas Markets
European sharemarkets advanced overnight. The Energy sector was the strongest performer, up 2.1%, following a rise in oil prices on the prospect of greater global demand. Royal Dutch Shell added 2.9%, while BP lifted 0.9%. Travel stocks enjoyed gains after four consecutive days of losses following fears of reinstated COVID-19 restrictions. International Airlines Group gained 3.7%, while Ryanair and easyJet rose 2.7% and 2.6% respectively.
The Financials sector also improved; Barclays gained 2.4% and Lloyds Bank rose 2.0%, while HSBC and Deutsche Bank added 1.5% and 1.1% respectively.
By the close of trade, the German DAX added 0.5% and the STOXX Europe 600 closed up 0.6%, while the UK FTSE 100 climbed 1.3%.
US sharemarkets also finished higher on Thursday, as all sectors except Consumer Staples improved. Financial services stocks rallied; PagSeguro Digital lifted 2.0% and MasterCard rose 1.5%, while Visa gained 0.6%. The Information Technology sector also advanced; Facebook added 1.9% and Fortinet gained 1.7%, while NVIDIA and Alphabet rose 1.1% and 0.8% respectively.
By the close of trade, the S&P 500 added 0.5% and the Dow Jones gained 0.4%, while the NASDAQ lifted 0.1%.
CNIS Perspective
Two primary sources of economic growth are business investment and consumer spending.
Over the past six months, US companies have significantly increased their orders for computers, software, machinery and other fixed assets as they grow more confident in the economic outlook.
Rising business investment helps fuel economic output and economists predict US business investment to increase over 100% to pre-pandemic levels after three years. By comparison, business investment took 10 years to reach these levels post-GFC.
The pandemic has forced companies to minimise contact between consumers and workers, resulting in a rapid increase in spending on technology.
Further, consumer spending, which accounts for about two-thirds of economic output, is also helping to drive the next stages of the US economic recovery. Americans, who are flush with savings and government stimulus checks, are spending more on goods and services, which they avoided for much of 2020.
Should you wish to discuss this or any other investment related matter, please contact your Investment Services Team on (02) 4928 8500.
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