If the futures market is any guide, the ASX will start with a rare event later today – a small fall after a fall on Friday night.
The move to lock down all of NSW from 5pm on Saturday should finally make investors pay attention to the worsening Covid Delta situation that has now brought the country’s biggest state economy to a halt and will slow the national economy.
That was after Eurozone shares rose 0.1% on Friday and the US S&P 500 gained 0.2% on the day and had a small rise for the week.
That saw ASX 200 futures fall 9 points, or 0.1%, pointing to a soft start today – it will be the first soft start to a week’s trading for a while because of the record trading sessions on Wall Street lately.
That was after the ASX 200 added 0.54% on Friday to end at a high 7,628.90.
Global share markets continued rose last week with reopening and earnings optimism offsetting growing Delta concerns and propelling US and European shares to record highs.
US shares rose 0.7%, Eurozone shares added 1.3%, Japanese shares rose 0.6% and Chinese shares ended up 0.5% as Covid infections rose and the Chinese government continued its crackdown on tech companies.
The Australian share market also rose 1.2% to a new high on the back of good earnings news offsetting ongoing dismal news on lockdowns.
Bond yields fell in the US and Europe but rose slightly in Australia.
Oil and metal prices rose but iron ore continued to slide (down around 6% for the week) and is now down 26% from its May high, but is just back to April levels which is still high.
The $A rose slightly in late trading on Friday as the $US fell.
The weak start for the ASX 200 came despite the Dow and the S&P 500 edged higher to record closes on Friday and a second straight week of gains, but a sharp drop in US consumer sentiment surprised investors.
The report from the University of Michigan showed the university’s highly respected preliminary consumer sentiment index fell to 70.2, its lowest level in a decade, suggesting that Covid Delta was impacting consumer confidence.
It was one of the biggest falls recorded in the survey’s 50+-year history.
California revealed a sharp rise of 4,000 in the number of new cases on Friday and the yield on the 10-year Treasury bonds fell to 1.28% after touching 1.36%, at the start of Friday’s session.
The slide in consumer sentiment is a reminder that the impact of Covid Delta is growing to reach dangerous levels.
Treasury yields have also experienced several sharp swings this year, wrongfooting investors. Yields on the 10-year fell to a low of 1.13% as recently as August 4 — some 65 basis points below the year’s highs of 1.78%.
The Dow rose 15.53 points, or 0.04%, to 35,515.38, the S&P 500 gained 7.17 points, or 0.16%, to 4,468 and the Nasdaq inched up 6.64 points, or 0.04%, to 14,822.90.
For the week, the Dow ended up 0.87%, the S&P 500 advanced 0.71% and the Nasdaq slipped 0.09%.
