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Global Market Report - 29 April

Lex Hall  |  26 Apr 2019Text size  Decrease  Increase  |  
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Australian shares are expected to open flat despite gains on Wall Street at the end of last week.

The SPI200 futures contract was down 2 points, or 0.03 per cent, at 6,366.0 at 8am Sydney time, suggesting a little-changed start for the benchmark S&P/ASX200 on Monday.

On Friday, the Australian share market was sapped of its recent bullishness during a thin day of trade, but the local bourse shook off a subdued resources sector to remain at a near 11-year high.

The benchmark S&P/ASX200 index had been as much as 0.3 per cent lower early on, but finished up 3.5 points, or 0.05 per cent, at 6385.6 points.

On Wall Street on Friday, the Dow Jones Industrial Average finished up 0.31 per cent, the S&P 500 was up 0.47 per cent and the tech-heavy Nasdaq Composite was up 0.34 per cent.

A 3 per cent fall in oil prices on Friday may point to a decline for energy shares on the ASX on Monday, AMP Capital chief economist Shane Oliver said.

The Aussie dollar is buying 70.42 US cents from 70.25 US cents on Friday.

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Several major financial stocks including National Australia Bank, ANZ Banking Group and Macquarie Group will deliver interim earnings results this week.


China stocks fell on Friday, posting their steepest weekly decline since October 2018, as investors feared that China may scale back its stimulus measures amid signs of economic stabilisation, while Sino-US trade conflict also weighed on sentiments.

The blue-chip CSI300 index fell 1.3 per cent, to 3,889.27, while the Shanghai Composite Index closed 1.2 per cent lower at 3,086.40.

Hong Kong stocks inched higher on Friday, but posted their biggest weekly drop in eight weeks.

The Hang Seng index rose 0.2per cent, to 29,605.01 points, while the China Enterprises index gained 0.1 per cent, to 11,510.87.

Around the region, MSCI’s Asia ex-Japan stock index fell 0.11 per cent, while Japan’s Nikkei index lost 0.22per cent.


European shares finished higher on Friday as some strong earnings and data showing US economic growth in the first-quarter beat expectations helped cut losses from earlier in the session.

The pan-European STOXX 600 index closed up 0.2 per cent, led by drugmaker Sanofi and aero engine maker Safran, on upbeat earnings, while a turnaround in banks to the black after US data also helped overcome the day’s losses of up to 0.9 per cent.

Positive US economic growth came as a relief, helping STOXX 600 post gains on the week, after dismal economic data from South Korea and Germany earlier this week had sounded alarm bells on global growth.

In April, its has so far gained over 3 per cent, on course to extend monthly gains to a fourth straight month.

But, STOXX 600 had briefly retraced session highs hit on the data as investors digested that the burst in growth was driven by temporary factors that are likely to reverse in the coming quarters.

While most country indexes rose, London’s energy-heavy FTSE 100 ended lower as a fall in crude prices hurt oil majors.

Banks benefited with gains by HSBC, Standard Chartered and Commerzbank helping the sector index overcome earlier losses logged on disappointing results from RBS and Deutsche Bank.

Healthcare, which is also seen as a defensive sector, was a bright spot. Gains of 3.5 per cent by French drugmaker Sanofi after it returned to growth with higher profits and revenues for the first-quarter was the biggest boost to the pan-region index.

Safran followed, up 3.4 per cent, after it outpaced revenue growth plans in the first quarter. Along with positive outlook by Renault and Ford and Valeo, it took Europe’s auto sector 0.9 per cent higher.

Reports that Renault will propose to Nissan a plan to create a joint holding company which would give both firms equal footing, also aided the rally in the French automaker.

Continental advanced after it backed its outlook for the year despite reporting a fall in first-quarter earnings.

Luxembourg-based satellite operator SES led media stocks higher after it maintained its full-year outlook on the back of the company’s Networks division.

Weighing on the broader regional benchmark index were oil stocks, tracking a decline in oil prices after US President Donald Trump said he called OPEC and told the cartel to lower oil prices.

France’s Total fell after it reported a falling first-quarter net profit.

Miner Glencore slipped 3.3 per cent as US regulators investigated if the company engaged in “corrupt practices”.

North America

A surprisingly strong report card on the US economy has helped power the benchmark S&P 500 and Nasdaq Composite indexes to record high closes, capping a week of gains for stocks that came largely on the back of resilient corporate profits.

While Intel Corp was the biggest drag on the day after it gave a bleak outlook, Amazon.com's results provided the biggest boost and Walt Disney also offered support as it basked in strong box office numbers.

After staying close to flat for much of the day on Friday the S&P, Nasdaq and the Dow gained ground in the last hour of trading to register their second record closes for the week. The S&P's peak for the day was a point below its intraday record.

The Dow Jones Industrial Average rose 81.25 points, or 0.31per cent, to 26,543.33, the S&P 500 gained 13.71 points, or 0.47 per cent, to 2,939.88 and the Nasdaq Composite added 27.72 points, or 0.34 per cent, to 8,146.40.

For the week, the S&P rose 1.2 per cent, while the Dow lost 0.06 per cent, and the Nasdaq gained 1.86 per cent.

After a late 2018 sell-off, stocks have rallied this year in large part due to a more dovish stance from the Federal Reserve as well as hopes of a US-China trade resolution.

Before the market open, US Commerce Department data showed gross domestic product rising faster than expected due to high inventories while consumer and business spending slowed sharply, and homebuilding investment contracted for a fifth straight quarter.

The US Federal Reserve meeting is due to start on Tuesday.

The S&P's biggest boost on Friday was from the consumer discretionary sector, which rose 0.9 per cent.

Its biggest support was from Amazon.com, which rose 2.5 per cent after the e-commerce giant's quarterly profit doubled and beat Wall Street estimates though its second quarter guidance was lower than expectations.

Also Ford Motor Co surged 10.7 per cent and was the biggest  percentage gainer on the S&P after the automaker posted better-than-expected quarterly earnings largely due to strong pickup truck sales in its core US market.


is senior editor for Morningstar Australia

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