The ASX is heading for a strong start to trading later today as the end of the month and quarter approaches and investors go through some ’strategic’ buying and selling.
There’s a lot of data from local and offshore to be released that could impact trading this week.
There’s the March 31 end of quarter for a string of local companies and the end of the first quarter for miners, and overseas, the always important US first quarter of 2021.
Key economic data will be released here, in China, Japan and the US especially ahead of the long Easter Break starting Friday (see Diary).
Ahead of this the overnight futures market ended with a 49-point gain for the ASX futures contract, so a strong start to trading this morning is expected.
That will go nicely with the 0.5% rise on Friday which ended the local market’s best week in seven and saw the ASX 200 finish the week 1.7% higher at 6,824.2.
That was a stronger gain for the week than the Dow, S&P 500, Nasdaq and the Stoxx 600 index in Europe.
Friday saw the Aussie dollar slip, gold, coper, oil, iron ore, silver and copper trade mostly higher and US bond yields softer after a key measure of inflation showed no concerns in February.
But the blockage in the Suez Canal which has halted all shipping in the region left commodity markets nervous (see Commodities Corner).
In fact the Aussie dollar ended at 76.40 US cents. down three quarters of a US cent over the week.
Wall Street jumped 1% in the last half hour of trading on Friday as investors rebalancing their portfolios at the quarter’s end
MSCI’s gauge of stocks across the globe gained 1.44% on Friday following broad gains in Europe and Asia – a sign of the upbeat sentiment at week’s end.
Friday saw the Dow end up 453.4 points, or 1.39%, to 33,072.88. The S&P 500 added 65.02 points, or 1.66%, to 3,974.54 and the Nasdaq rebounded 161.05 points, or 1.24%, to 13,138.73.
It had been in the red for a while in Friday’s session as investors chased value stocks in the Dow and parts of the S&P 500.
For the week, the S&P rose about 1.6% and the Dow 1.4%, while the Nasdaq eased 0.6%.
Blue chip Chinese stocks rebounded more than 2.2% on Friday after a three-day losing streak.
The gain came after signs of a renewed crackdown on debt by Chinese monetary authorities. The CSI 300 index only managed a rise of 29 points for the week, or 0.05%.
In Tokyo the nikkei rose 1.5% on friday in a strong rebound from previous weakness that still left the index down more than 2% for the week.
In Europe the Stoxx 600 index added 0.9% on Friday which was all the week’s gain of 0.8%.
The yield on 10-year US Treasury bonds fell 1.68%, from 1.614% late on Thursday after ending around 1.72% the previous Friday (and touching 1.75% the same day).
The key PCE (Personal Consumption Expenditure) data for February showed a fall in consumer spending and a 0.1% rise in core inflation (so-called PCE inflation favoured and tracked closely by the US Federal Reserve) in the month for an annual rate of 1.4%, down from 1.5% in January and still well short of the Fed’s now ‘flexible’ 2% inflation target.
Weekly money flow data from Bank of America showed global investors stopped the charge into equities that had been going on for the previous few weeks and pushed $US45.6 billion into cash management funds, the largest since April 2020, when COVID-19 was spreading quickly.
The stars on the ASX last week were CSL and Telstra. CSL shares rose 5.3% as the first locally-made vaccine shots began rolling out of the company’s Melbourne plant
Telstra added another 2.4% on Friday taking its weekly gain to 6.2% after it revealed its future corporate structure – four separate entities.
