Originally published by Rivkin Securities
The ASX is looking at a continuation today of last week’s solid run which saw the market up 2.2% - its best weekly performance this year. The strength of the ASX was in sharp contrast to the performance of other markets last week and is likely the result of a falling local currency which has made Aussie shares cheaper globally.
Throughout last week, US shares were down 0.9%, Eurozone shares dropped 1.9%, Japanese shares were down 1.5% and Chinese shares slumped 3.8%, while emerging market shares remained under pressure.
Commodity prices weakened for most of the week thanks to the stronger US dollar, yet that and Trump’s trade rhetoric didn’t impact local investor sentiment. If anything, the local market rose despite the negative overseas leads, and it was a very solid (and unusual of late) rise in the banks for most of the week as the gloom from commentators and analysts in the wake of the banking royal commission disappeared. Additionally, foreign earners such as CSL (AX:CSL) and Macquarie Group (AX:MQG) continued their rally as their earnings continue to balloon on the lower currency.
Oil prices rallied Friday, with US crude futures up nearly 6% for the week, as OPEC members agreed to raise output but by an amount that appears to be less than the market had anticipated. Gold futures edged higher on Friday but still lost ground over the week as a stronger US dollar undermined many metal prices. Gold is on track for a month-to-date fall of 2.6%. Thursday’s settlement of $US1,270.50 an ounce was the lowest since December.
Data Releases:
- No Significant Data