Global Fundamental Analysis 06/09/2021

Global Fundamental Analysis 06/09/2021, FP Markets

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


U.S. stocks ended mixed after a lacklustre U.S. jobs report. The 10-year Treasury note yield was at 1.33%, according to Tradeweb, up from 1.29% at Thursday’s close. The WSJ Dollar Index fell 0.16% to 86.83. U.S. oil prices ended lower but posted a weekly gain on a slow Gulf output recovery. Gold futures climbed for the week to their highest in 11 weeks after downbeat August U.S. jobs data.


Australian Market

Australia’s S&P/ASX 200 index closed 0.5% higher, finishing higher for the week amid gains by commodity stocks. The benchmark followed a positive lead by U.S. stocks, supported by rising iron ore futures and higher oil prices. Materials, the ASX 200’s second-largest sector by market capitalization, rose 1.2%. The ASX 200 gained 0.5% for the week.


US Market

The stock market was relatively quiet this week with major indices sticking to a narrow range most days. On the day, the S&P 500 dropped less than 0.1%. For the week, the index rose 0.6%. The Dow Jones Industrial Average lost 0.2% and edged down 0.2% for the week, while the Nasdaq Composite Index rose 0.2% and added 1.6% for the week.  

Earnings season has wound down now that the bulk of S&P 500 companies are done sharing their second-quarter results. Trading typically slows down ahead of the Labor Day weekend since U.S. stock and bond markets are closed Monday in observance of the holiday.

The Labor Department’s employment report showed the pace of hiring slowed significantly in August, with the economy adding 235,000 jobs, well below the 720,000 jobs that economists surveyed by The Wall Street Journal had estimated.



Gold futures climbed, with data showing a lower-than-expected increase in new U.S. jobs in August prompting prices for the precious metal to notch again for the week and mark their highest finish since mid-June.  

December gold rose 1.2% to settle at $1,833.70 an ounce. For the week, gold saw a 0.8% rise, based on the most-active contracts, with prices settling at their highest since June 16, according to FactSet data.


Oil Futures

Oil futures ended lower on the back of smaller-than-expected gains in U.S. nonfarm payrolls in August, but a slow post-hurricane recovery in energy operations at the Gulf of Mexico contributed to a gain in prices for the week.  

West Texas Intermediate crude for October delivery on the New York Mercantile Exchange lost 1% to settle at $69.29 a barrel. Global benchmark November Brent crude declined by 0.6% to $72.61 a barrel on ICE Futures Europe, marking a weekly rise of 1.3%.



Major currencies were stronger against the US dollar in European and US trade. The Euro rose from lows near US$1.1865 to session highs near US$1.1905 and was near US$1.1882 at the US close. The Aussie dollar lifted from lows near US74.15 cents to highs near US74.75 cents and was near US74.58 cents at the US close. And the Japanese yen firmed from near 110.05 yen per US dollar to JPY109.60 and was near JPY109.73 at the US close.


European Markets

European sharemarkets eased on Friday with the weak US jobs report weighing on retail and travel stocks. The pan-European STOXX 600 index fell by 0.6%. The German Dax index and the UK FTSE index both lost 0.4%. In London trade shares in Rio Tinto were flat while shares in BHP rose by 0.6%.


Asian Markets

Japan’s Nikkei Stock Average closed 2.0% higher, helped by gains in real estate and pharmaceutical stocks. Political developments were in focus, with Japanese Prime Minister Suga announcing that he would not be seeking re-election as the ruling party leader. Pharmaceutical stocks led the gains. Chinese stocks ended the session lower, with the benchmark Shanghai Composite Index falling 0.4%, snapping a five-day rally.

The Shenzhen Composite Index fell 0.6% while the ChiNext Price Index suffered the largest loss, closing 1.2% lower. Extended weakness in mining companies, which were among the top gainers in earlier sessions, weighed on the market. The sector, especially copper prices, fell under pressure in recent days as Beijing began the bidding process for its latest release of metal reserves, while a patch of weaker economic data from China further raised concerns.

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