Thursday's employment data shocked the market and media alike, with employment falling by 39,300 compared to the 20,000 increase economists were expecting. Bad news for the government ahead of next month's Victorian State election, but a welcome reprieve for the RBA, with markets now pricing in only a ~40% chance of another 25bps rate hike before Christmas, although inflation could ultimately force their hand if oil prices keep rising. In 10 days, we get the September CPI (inflation data), which will go a long way in determining the next move on rates.
The ASX 200 finished a volatile week up +1.0%, although the headline gain masked some fairly aggressive rotation beneath the surface. Utilities (+4.5%), Healthcare (+3.9%), Consumer Staples (+3.4%) and Financials (+3.2%) led the market higher, while Materials (-2.3%), Real Estate (-1.7%) and Information Technology (-1.3%) lagged. Investors continued to rotate into some of the more beaten-up and defensive areas of the market, while resources came under pressure.
The local market staged a broad recovery today as technology and materials stocks bounced back from heavy losses, supported by easing concerns around the global AI thematic, triggering renewed buying across oversold sectors though weakness in banks and consumer staples limited the advance.
The ASX 200 staged an impressive recovery on Thursday, clawing its way back from an early 1% decline to finish virtually unchanged at 8,720 (-0.1%), as weaker than expected employment data provided a welcome reprieve from the recent interest rate concerns.
Local shares finished marginally lower as a defensive rotation into consumer staples and financials offset a sharp sell-off in miners, technology and data centre stocks, with softer domestic employment data providing some relief on interest rate expectations after hotter-than-expected US inflation reignited rate concerns overnight.
The ASX 200 was hit -0.6% on Wednesday for no obvious reason, with renewed selling in the banks the main weight, with the financials accounting for more than 70% of the index's decline. However, weakness was broad-based, with over 70% of the main board closing lower, and the miners adding to the market's woes, which unfortunately look set to extend today.
A weaker session on the ASX today, with the market snapping its recent winning streak as banks unwound yesterday’s rally. Financials and Materials weighed on the index, while Energy, Telecommunications and Real Estate provided some support.
The ASX fought valiantly on Tuesday to reverse early losses ending the session basically flat. However, it was far from a quiet session on the stock and sector front with AI facing tech stocks whacked, with Megaport (-9.9%) and NEXTDC (-6.6%) enduring sessions to forget.
A mixed session on the ASX today, with the index recovering from intraday losses to finish almost unchanged. Defensive sectors, energy and banks provided some support, but a sharp global semiconductor sell-off weighed heavily on Technology, while Materials and lithium stocks also came under pressure.
The ASX 200 big guns started firing on Monday in a rare session of solidarity between the banks and heavyweight miners, the financials and materials combined to add 79-points to the ASX 200, which only closed up 66-points on the day! For a 0.8% gain it was unusual to see almost 50% of the main board close lower, such was the dominance of the likes of BHP (+2.5%) and Westpac (+2.7%).
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