The Australian market is down 0.44% in Friday afternoon trade bringing the decline for the week to more than 2.2%.
The Materials sector is leading the losses today (-1.24%) and is down more than 3.5% for the week. This comes as Rio Tinto (ASX:RIO), BHP (ASX:BHP), and Fortescue (ASX:FMG) track falls in the iron ore price — each having retreated by 1.5% or more this afternoon.
Consumer discretionary and tech stocks are also having a rough day. Utilities are one of three sectors trading higher (+0.72%), alongside Industrials and Healthcare.
For the week, all nine sectors are lower, with the exception of Energy amid oil prices hitting ten month highs.
Westpac lifts GDP growth forecasts
Westpac has lifted its GDP growth forecasts from 1% to 1.2% for 2023, and from 1.4% to 1.6% for 2024.
The bank’s chief economist Bill Evans says June quarter data, released this week, was in line with the bank's expectations. The data showed the economy expanded by 0.4% in the quarter while annual growth slipped from 2.4% to 2.1%.
But the March quarter result was upgraded, prompting Westpac to lift its 2023 GDP growth forecast. It also lifted its forecast for 2024, due to a modest uplift in growth in the second half.
Morgan Stanley (NYSE:NYSE:MS) drops next year’s rate cut expectations
Following the RBA’s decision on Tuesday to keep rates on hold at 4.1% for another month, analysts at Morgan Stanley (NYSE:MS) have cut their rate cut expectations.
In a recent analyst note, the firm retained its forecast for a November cash rate increase but dropped its forecast from three rate cuts next year, down to two, and “now expect cuts in August and November to end 2024 at 3.85%”.
Economists’ views are mixed on whether we’ll see another rate hike this year, possibly in November, once the central bank has a chance to assess September quarter inflation data and digest the latest forecasts for its final statement of monetary policy for the year.
Five at Five
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