The ASX is heading for a questionable opening today after the overnight futures market ended with a 7-point gain on Saturday morning as Wall Street and other markets ended at record or long-time highs.
Eurozone shares rose 0.6% on Friday and the US S&P 500 was up 0.5% with investors looking through the weak December payroll report (a loss of 140,000 jobs) and focussing instead on expectations for more fiscal stimulus which the incoming Biden administration is expected to announce this week.
But the sell-off in gold will hammer the ASX gold sector hard today, sending share prices lower and offsetting another strong session for iron ore on Friday.
Comex gold’s fall – $US77 at settlement price – was massive, well over 3.5% which pushed the metal to a loss of 2.7% for the first week of 2021.
By the close of trading to end the week gold had recovered to $US1,849, $US15 above the settlement figure of $US1,835 an ounce but still looking weak.
Investors will also be watched for the flow of local data this week with reports on retail sales for November and lending data, as well as the latest economic and growth data from China late in the week.
The American political uncertainty could also damage confidence this week if Donald Trump erupts again.
Trading Friday saw the ASX end at its highest close in 11 months with the ASX 200 rising another 0.7% on Friday to finish at 6,757.9 points – its best close since last February – with Afterpay, CSL and the major banks among the major drivers.
The ASX 200 rose 2.6% last week to record its best week since early November, with mining and energy stocks driving gains on improved oil and iron ore prices and banks doing well.
BHP eased from a record high to finish 0.5% lower at $46.67, while Rio Tinto dropped 1.3% to $124.01, and Fortescue Metals shed 2.2% to $25.34.
For the week BHP shares rose 10%, Rio, 8.9% and Fortescue rose 8.1%. The price of 62% Fe fines was up nearly 8% for the week.
The lenders were strong in the final session of the week, with Commonwealth Bank up 1.2% to $85.63, NAB up 1.4% to $23.35, Westpac 1.5% higher at $20.28, and ANZ rising 0.9% to $23.84.
For the week, CBA shares were up 4.3%, Westpac shares rose 4.7%, NAB shares added 3.3% and ANZ shares jumped 5%.
Afterpay rose 6.6% to $116 and biotech CSL rose 1.9% to $280.25 on Friday, although both fell more than 1% for the week.
