The ASX200 ended its 8-day losing streak on Friday with a solid +0.7% advance, although it promised more early on before the “Big Four Banks” reversed lower. It felt worse, but come the closing bell on Friday, the index was only down 0.6% for the week, although compared to the strong gains in the US, it was a clear disappointment. It was the big end of town that reined in the market last week, with the banks and heavyweight miners retreating. Next Wednesday, we see the RBA step up on interest rates, with credit markets pricing in a ~74% probability of a 0.25% hike, while on the following Tuesday, we will receive the Federal Budget- there’s no rest for the wicked in May!
- The bank results in May are vital to the local markets’ relative strength, and the ASX’s reaction on Friday to ANZ’s update wasn’t a great sign.
The winners’ and losers’ enclosures were split into two clear halves over the last 5-days, with lithium stocks enjoying a stellar week while gold names struggled. The strength across lithium stocks even relegated takeover target ALX to 4th position on the leaderboard. We also had a few decent moves courtesy of trading updates, but their impact was more on index points than percentage moves.
Winners: Codan Ltd (ASX:CDA) +22%, Liontown Ltd (ASX:LTR) +18%, Mineral Resources (ASX:MIN) +12%, Atlas Arteria (ASX:ALX) +11%, IperionX (ASX:IPX), Iluka (ASX:ILU) +10%, and IGO Ltd (ASX:IGO) +10%.
Losers: Catalyst Metals (ASX:CYL) -17%, Resolute Mining (ASX:RSG) -16%, 4DMedical (ASX:4DX) -16%, Pantoro Gold (ASX:PNR) -15%, Westgold Resources (ASX:WGX) -12%, Silex (ASX:SLX) -10%, and Woolworths (ASX:WOW) -10%.
The shortened week after ANZAC Day didn’t come with huge amounts of geopolitical and economic news, but the Iran War continues to see no end in sight:
- The week started in the same mood as the previous one, slipping lower with the banks weighing on the market.
- On Wednesday, Australia’s March inflation print came in slightly better than expectations but not soft enough to diminish expectations of a rate hike on Tuesday.
- Thursday saw the ASX fall for its 8th consecutive day after Woolworths (ASX:WOW) delivered a disappointing trading update, weighing on the whole consumer staples sector.
- Friday finally saw some green on the screen, with the miners managing to offset another tough session for the banks.
Overseas markets were mixed on Friday night, although the S&P 500 managed to close at a new high, helped by a 3.2% gain in Apple Inc. (NASDAQ:AAPL). In Europe, the French CAC advanced +0.5% while the UK FTSE slipped by 0.1%. In the US, tech-based NASDAQ led the line, advancing +0.19% while the Dow fell by 0.3% with Amgen Inc. (Nasdaq: AMGN) the largest drag.
- The SPI Futures are calling the ASX200 to slip 0.3% on Monday following the mixed session on Wall Street.
