The ASX 200 fell 1.6% last week, testing 9100 on Friday after threatening to break above 9300 on Tuesday. While the early read from local earnings seasons failed to match their US peers, it was the influential banks and miners that combined to drag the index lower – for the week, heavyweights CBA (-6.1%), Westpac (-6.8%), BHP Group (-2.6%), and RIO Tinto (-5.7%) all weighed on the local bourse.
As we would expect this time of year, last week’s winners and losers were dominated by reporting season with some M&A seasoning thrown into the mix:
Winners: Cleanaway Waste (ASX: CWY) +14%, Austal (ASX: ASB) +14%, Helia Group (ASX: HLI) +12%, Origin Energy (ASX: ORG) +12%, CAR Group (ASX: CAR) +11%, ResMed (ASX: RMD) +11%, Elevra Lithium (ASX: ELV) +10%, and Light & Wonder (ASX: LNW) +9%.
Losers: Arena REIT (ASX: ARF) -30%, Life360 (ASX: 360) -18%, 4DMedical (ASX: 4DX) -14%, HomeCo Daily Needs REIT (ASX: HDN) -10%, DroneShield (ASX: DRO) -11%, SGH Ltd (ASX: SGH) -10%, Judo Capital (ASX: JDO) -9%, and Lovisa (ASX: LOV) -9%.
Weekly snapshot: Last week the ASX struggled despite US indices posting new highs on Thursday:
- The banks set the tone for the week on Monday as Westpac’s trading update confirmed lending volumes have fallen sharply.
- On Tuesday the RBA left rates on hold at 4.35%, but the Board discussed the case for another rate rise – something it did not do at its previous meeting.
- CBA weighed on the ASX mid-week as housing headwinds grow; it more than offset strength in peer ANZ, whose turnaround remains on track.
- Friday delivered a tough session to the miners, dragging the index back towards 9100 with BHP’s 3.3% taking 35 points off the ASX200 on its own.
- On Friday night, US Retail Sales fell the most since May last year, dampening market sentiment into the weekend.
On the economic front, next week is expected to begin relatively quietly, before attention turns to Thursday’s US FOMC Meeting Minutes and Initial Jobless Claims. In Australia, Thursday’s employment data will be the key focus for bond markets, with the release likely to further influence expectations for interest rates. On the reporting front, BHP on Monday and CSL on Tuesday are likely to have the heaviest influence on the ASX.
Overseas markets ended the week on the back foot as signs emerged that US consumers are starting to struggle. In Europe, the UK FTSE and French CAC both retreated by -0.2%. In the US, early gains were reversed with the Dow and S&P 500 also both closing down by -0.2%.
- The SPI Futures are calling the ASX200 to open down by 0.4% following weakness on Wall Street.
