Global Markets Report - 5 March
ASX set to open flat, after Wall Street loses momentum.
Australia
Australian shares are set to open flat, after Wall Street loses momentum.
ASX futures were slightly down 0.03% or 3 points as of 8:30am on Tuesday, suggesting a flat open.
U.S. stocks slipped as investors anticipate testimony from Fed Chair Powell and February jobs data later this week. A 3.6% gain in Nvidia shares was unable to offset weakness in other technology giants.
DJIA fell 97 points, or 0.3%, to 38990, the S&P 500 lost 0.1% to 5130 and the Nasdaq slipped 0.4% to 16207.
In commodity markets, Brent crude oil was down 0.8% to US$82.85 a barrel, while gold was up 1.6% at US$2,115.87.
In local bond markets, the yield on Australian 2 Year government bonds was down at 3.77% while the 10 Year yield was also down at 4.10%. US Treasury notes were up, with the 2 Year yield at 4.61% and the 10 Year yield at 4.22%.
The Australian dollar hit 65.08 US cents down from its previous close of 65.25. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was up at 98.51.
Asia
Chinese shares ended higher as Beijing kicked off the annual plenary sessions. The meeting, from which investors hope more supportive policies will be released, officially began on Monday and will conclude on March 11. Among the major stocks, WuXi AppTec rose 9% as concerns about U.S. sanctions against the WuXi family of biotech and research companies eased. Decliners included China Vanke, which dropped 4.65%, and New China Life Insurance, which fell 4.4%. The benchmark Shanghai Composite Index ended up 0.4% at 3039.31, the Shenzhen Composite Index was 0.2% higher, while the ChiNext Price Index gained 0.6%.
Hong Kong shares ended the session flat, with focus on the legislative gathering in China and its policy outcomes. Short-term turbulence in Hong Kong and China markets may follow any government interventions announced at the meetings, with long-term bullish sentiment hinging on investors' confidence in China's growth and productivity, Saxo Markets chief China strategist Redmond Wong writes in a commentary. Among the losers was carmaker Li Auto, which slumped 11% on possible profit-taking and consumer disappointment with its newest EV model. Casino operator Sands China shed 6.1%. Among the advancers, WuXi AppTec gained 13%, and Wuxi Biologics rose 12%. The Hang Seng Index was flat at 16595.97; the Hang Seng Tech Index fell 0.4% to 3474.77.
The Nikkei Stock Average rose 0.5% to 40109.23, closing above the 40000 threshold for the first time. Chip stocks led the gains thanks to enthusiasm for artificial intelligence, while financial and shipping stocks posted some drops. Renesas Electronics gained 4.9% and Advantest climbed 3.7%, while Nippon Yusen fell 2.9% and Japan Post Insurance lost 1.3%. The broader Topix market index declined 0.1% to 2706.28. Investors are focusing on economic data and their policy implications. The 10-year Japanese government bond yield was down half a basis point at 0.710%.
India's Sensex rose 0.1% to close at 73872.29, ending higher for a third straight session. Among utility stocks, NTPC was up 3.5% and Power Grid Corp. of India rose 2.6%. Axis Bank added 0.9% and ICICI Bank gained 0.8%. The long-term story of India's equity market continues to remain attractive, said Neeraj Chadawar, head of research at Axis Securities, in a note. The themes of "growth at a reasonable price" and quality look appealing, said Chadawar, who recommends that market participants stay invested in domestic stocks.
Europe
European stocks traded mostly steady, with the pan-European Stoxx Europe 600 index unchanged at 497.41 ahead of a busy week, which includes Thursday's European Central Bank meeting and Friday's U.S. monthly jobs data. "Today marks a relatively slow start to a busy week, with traders gearing up for a four-day period that will bring monetary policy and U.S. jobs to the fore," says Scope Markets analyst Joshua Mahony in a note. Germany's DAX and France's CAC 40 traded steady but the U.K.'s FTSE 100 index underperformed, falling 0.6% on caution before the U.K.'s budget announcement on Wednesday amid reports there might be limited room for fiscal stimulus, Mahony says. Falls for heavyweight mining stocks also weigh on the FTSE.
The FTSE 100 closed down 0.6% on Monday, snapping a two trading-day winning streak, as the U.K.'s upcoming budget--perhaps the last before the next U.K. general election--loomed large for later in the week. The budget opens the possibility to some fiscal easing aimed at improving general consumer sentiment, interactive investor analyst Richard Hunter said in a note. "However, there are concerns that it will be interest-rate cuts from the Bank of England rather than marginal tax rate reductions which are likely to be the main resuscitator of growth," he says. Entain, Ocado and St. James's Place were the session's biggest fallers, down 7.85%, 6.5% and 4% respectively. Endeavour Mining was the day's highest riser, up 3.3%, followed by Fresnillo and Melrose Industries, up 2.7% and 2.3% respectively.
North America
U.S. stocks slipped as investors anticipate testimony from Fed Chair Powell and February jobs data later this week. A 3.6% gain in Nvidia shares was unable to offset weakness in other technology giants.
DJIA fell 97 points, or 0.3%, to 38990, the S&P 500 lost 0.1% to 5130 and the Nasdaq slipped 0.4% to 16207.
Apple slipped 2.5% after the European Union fined it about $2 billion saying the iPhone maker set unfair rules for developers of music-streaming apps.
JetBlue Airways gained 4.3% after terminating its merger agreement with Sprit Airlines, which dropped 11%.
Oil prices slipped, despite Opec agreeing to extend production cuts.