Monday 11th March 2019

OPENING CALL: The Australian market looks to open lower with SPI Futures down 14 points.

It was another six-month high for Australia’s stock benchmark as the market avoided the selling seen in the likes of Japan, China and Korea.
U.S. stocks slid intraday after the European Central Bank unveiled plans to deploy additional stimulus, raising fresh worries about the health of the global economy. Lingering questions about trade relations and the world economy have put a damper on the stock market’s 2019 rebound.

Overnight Summary


Market Quotes by TradingView

Each Market In Focus

Australian Market

Australian stocks were hit by a wave of selling that hit most Asia-Pacific markets in the wake of European economic worries and dank, holiday-impacted February trade data from China. The ASX 200 fell 1% to 6203.8, its worst day in two months, finishing just off session lows. Though the week’s gain was slashed to 0.2%, it was the third straight advance and seventh in the past nine weeks. Financials and energy stocks each fell some 1.5% while materials lost 1.1%. But REITs rose slightly as bond yields fell further overnight.

US Markets

Major U.S. indexes closed out their worst week since December ahead of the bull market’s 10th anniversary, dragged down by swelling concerns about slowing economic growth around the world. Questions about the health of the U.S. economy mounted Friday after data showed a sharp slowdown in U.S. hiring growth last month, sending the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite lower for a fifth-straight trading session. The lackluster data rounded out a troubling week for investors that included doubts around the fate of a trade pact between the U.S. and China, a Thursday decision by the European Central Bank to deploy additional stimulus and a Friday report showing Chinese exports falling combined to exacerbate investors’ fears that major economies around the world may be decelerating faster than expected. The Dow Jones Industrial Average fell about 23 points, or 0.1%, to 25450, while the S&P 500 slid 0.2%. The Nasdaq Composite also declined, shedding 0.2%.

Commodities

Haven gold climbed by 1% to notch a slight gain for the week, boosted by losses in global stock markets on the heels of weak Chinese export and U.S. jobs data. April gold added $13.20, or 1%, to settle at $1,299.30 an ounce after briefly trading as high as $1,301.30. After a back-and-forth week, including the lowest settlement on Tuesday since late January, prices for the most-active contract were up 10 cents from the week-ago finish, FactSet data show. May silver rose 30.9 cents, or 2.1%, to $15.349 an ounce, for a 0.6% weekly climb. In other commodity markets, March wheat prices rose 1 1/4 cents to $4.32 3/4.

Iron Ore: 82.17s – 1.99 (April Contract)

Oil Futures

Oil prices fell after downbeat comments about U.S.-China trade and weak February U.S. hiring figures stoked fears of slowing economic growth and slumping commodity demand. West Texas Intermediate futures, the U.S. oil benchmark, pared much of their earlier slide but still ended down 59 cents, or 1%, at $56.07 a barrel on the New York Mercantile Exchange. Easing oversupply fears have pushed up prices 23% this year, though they remain 27% below their Oct. 3 multiyear highs after last quarter’s rout. Brent crude, the global oil gauge, dropped 56 cents, or 0.8%, to $65.74 a barrel on London’s Intercontinental Exchange. Crude followed equity markets lower after the U.S. ambassador to China said the world’s two largest economies have yet to set a date for a summit to resolve their trade dispute, as neither side feels an agreement is imminent. Trade optimism had buoyed oil and other risk assets earlier in the year by lifting the outlook for the global economy.

Forex

The U.S. dollar fell to end the week as the monthly jobs report showed hiring growth slowed significantly in February. The WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, was recently down 0.2% to 90.28. Investors sold the dollar after it recorded seven consecutive sessions of gains, which lifted the currency to the highest level of the year on Thursday. The latest labor report showed that the U.S. added 20,000 jobs in February, well below the 180,000 new jobs expected by economists surveyed by The Wall Street Journal. The fresh data added to worries that weak economic growth globally could be trickling into the domestic economy. The U.S. dollar was recently down 0.4% against the Japanese yen, which is known as a haven in times of volatility, according to FactSet. The euro was recently up about 0.3% against the U.S. dollar.

European Markets

Europe’s indexes fell, after economic slowdown fears were compounded by data showing a slump in Chinese exports. Disappointing figures from Germany’s manufacturing sector added to the gloom, a day after the European Central Bank announced cuts to its growth forecast. And then weak U.S. jobs data compounded worries for investors. The Stoxx Europe 600 fell 0.9% to end at 370.57 after finishing down 0.4% on Thursday evening. The U.K.’s FTSE 100 slipped 0.7% to 7,104.31, while Germany’s DAX fell 0.5% to 11,457.84 France’s CAC 40 dropped by 0.7% and Italy’s FTSE MIB index fell by 1%, while Spain’s IBEX 35 tumbled 1.3%.

Asian Markets

Chinese stocks saw heavy selling after a five-week surge, leading to a broad decline in Asian equities. Some markets logged their worst weeks in months while falling more than 1%. That included South Korea and Japan, and mainland benchmarks skidded upward of 4%, logging their worst day in months. The Shanghai Composite posted its first weekly drop since early January. Worries about Europe’s economy started the day off poorly for most Asian markets, and it worsened after China’s dour trade data. Singapore shares hit their lowest levels in more than a month. The Straits Times Index ended about 1% lower at 3195.87. It was also the second straight weekly decline for the index since Feb. 1 with only two stocks — Hongkong Land and Jardine Strategic — logging gains. Malaysian stocks closed lower, ending a two-day gaining streak. Market breadth was negative, with losers beating gainers by 524 to 328. The Kuala Lumpur Composite Index ended 0.42% lower at 1,679.90. Indian shares paused after rising for the past four sessions amid weakness in other global markets and as investors remained cautious ahead of economic data. The S&P BSE Sensex closed 0.2% lower at 36,671.43. Investors will track inflation and industrial production data due next week.

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