Global Fundamental Analysis 05/09/2022

Australian Market

Australia’s S&P/ASX 200 index closed 0.3% lower. The benchmark index was dragged down by miners, with the materials sector the biggest loser, shedding 1.9%. The heavyweight financial sector finished up 0.7%, with major banks ANZ, NAB, CBA and Westpac putting on between 0.5% and 0.9%. The ASX 200 finished 3.9% lower for the week.

US Market 

A late-summer selloff in the stock market accelerated during a volatile trading session, with major indexes giving up their early gains and finishing a third straight week of losses. The S&P 500 was down 1.1%. The tech-focused Nasdaq Composite Index lost 1.3% and the Dow Jones Industrial Average shed 1.1%. Major indexes initially surged Friday after the release of a strong monthly jobs report but later turned lower.  

The Labor Department said the U.S. economy added 315,000 jobs in August – roughly in line with what economists surveyed by The Wall Street Journal had expected – while the unemployment rate inched up to 3.7%. After the jobs figure, the Kremlin-controlled energy company Gazprom said it would suspend the Nord Stream natural-gas pipeline to Germany until further notice, raising the pressure on Europe as governments race to avoid energy shortages this winter.

Commodities

Gold ended higher in the wake of release of the monthly U.S. employment data. December gold rose 0.8% to settle at $1,722.60 per ounce on Comex. “The U.S. labor market is strong,” said Naeem Aslam, chief market analyst at AvaTrade. The Labor Department said the U.S. added 315,000 new jobs in August, basically matching Wall Street estimates.

Oil Futures

Oil futures saw a modest gain, but posted a hefty weekly loss as investors awaited a meeting of the Organization of the Petroleum Exporting Countries and its allies. West Texas Intermediate crude for October delivery rose 0.3% to settle at $86.87 a barrel on the New York Mercantile Exchange. November Brent crude, the global benchmark, added 0.7% to $93.02 a barrel. Attention is focused on Monday’s meeting of OPEC and its allies, when U.S. markets will be closed for the Labor Day holiday.

Forex

Major currencies were mixed against the US dollar in European and US trade. The Euro rose from near US$0.9960 to highs near US$1.0030 but was back near US$0.9950 at the US close. The
Aussie dollar rose from near US67.80 cents to highs near US68.55 cents and was back near US68.08 cents at the US close. And the Japanese yen held between 139.94 yen per US dollar and JPY140.77 and was near JPY140.20 at the US close.

European Markets

European sharemarkets rose on Friday with the pan-European STOXX 600 index up by 2.0% – the first rise in six sessions. Over the week the STOXX 600 index fell 2%. Credit Suisse rose 6.1% on
reports that Switzerland’s second-biggest bank is considering cutting around 5,000 jobs. The German Dax index lifted by 3.3%. And the UK FTSE index rebounded by 1.9%. In London trade, shares in Rio Tinto rose by 2.0% and shares in BHP gained 2.5%.

Asian Markets

Earlier, in Asia, Japan’s Nikkei Stock Average ended flat in choppy trade, amid expectations that the U.S. central bank will likely raise interest rates higher-for-longer. Aviation stocks were lower despite a further easing of border controls by the Japanese government. Chinese stocks finished mixed, as continued Covid-19 outbreaks in the country dragged consumer-related sectors, while telecommunications and electronics shares strengthened.

The latest U.S. curbs on sales of high-end processors to China could speed up local companies’ purchases of domestically produced chips, Huatai Securities said in a note. The Shanghai Composite Index ended flat as did the ChiNext Price Index. The Shenzhen Composite Index climbed 0.4%.