Global Fundamental Analysis 05/05/2021

Global Fundamental Analysis 05/05/2021, FP Markets

Opening Call: The Australian share market is to open higher.

U.S. stocks closed mixed, with the Nasdaq Composite off almost 2% and the Dow industrials flat. The 10-year Treasury note yield fell 1.5 basis points to 1.591%, after running as high as 1.625%. The WSJ Dollar Index was up 0.27% to 86.18. Oil was up a second day on bets for higher demand as the U.S. and Europe, eased Covid-19 restrictions.

Gold prices finished lower as Treasury Secretary Janet Yellen suggested a potential rise in U.S. interest rates.

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Australian Market

Australia’s S&P/ASX 200 index closed 0.6% higher thanks to strength among commodity stocks. The energy sector rose 1.7% amid stronger oil prices, while financials were flat.

Tech was again the worst performer, dropping 2.0% following a decline by the Nasdaq Composite.

US Market

Technology and other growth stocks stumbled, coming under pressure after a run that has pushed major indexes to repeated records.  

The Nasdaq Composite Index dropped 1.9%, stung by declines in shares of semiconductor companies, along with big tech stocks including Apple, Facebook and Alphabet.

The S&P 500 slid 0.7%, and the Dow Jones Industrial Average rose 0.1%.

Commodities

Gold prices finished lower after U.S. Treasury Secretary Janet Yellen suggested that the Federal Reserve may need to raise interest rates to rise to keep the economy from overheating.  

Gold for June delivery lost $15.80, or 0.9%, at $1,776 an ounce, following a 1.4% gain on Monday that helped the metal notch the highest settlement for a most-active contract since April 21, FactSet data show.

Oil Futures

Oil futures posted again for a second session, finding support as traders bet that easing Covid-19 restrictions in the U.S. and Europe will lead to higher fuel demand as the market approaches the summer travel season.

West Texas Intermediate crude for June delivery rose $1.20, or 1.9%, to settle at $65.69 a barrel on the New York Mercantile Exchange. July Brent crude, the global benchmark, added $1.32, or almost 2%, at $68.88 a barrel on ICE Futures Europe.

Both contracts settled at their highest since March, according to Dow Jones Market Data.

Forex

Major currencies were mostly weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.2038 to lows near US$1.1998 and was near US$1.2015 at the US close. The Aussie dollar fell from highs near US77.48 cents to lows near US76.76 cents and was near US77.10 cents at the US close. But the Japanese yen lifted from near 109.47 yen per US dollar to JPY109.04 and was ear JPY109.30 at the US close.

European Markets

European sharemarkets closed lower on Tuesday. The panEuropean STOXX 600 index lost 1.4% with technology shares down 3.8%. Shares of German software firm TeamViewer fell by 12.3%. The German Dax index dropped 2.5%. The UK FTSE index fell by 0.7%. The UK IHS Markit manufacturing purchasing managers’ index rose from 58.9 in March to an almost 27-year high of 60.9 in April (survey: 60.7). London-listed shares of Rio Tinto (+0.7%) and BHP (+0.5%) both rose.

Asian Markets

The Tokyo Stock Exchange is closed through Wednesday for holidays. 

Chinese stock markets are closed through Wednesday for the Labor Day holiday.

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  • Global Fundamental Analysis 05/05/2021, FP Markets
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