Stockmarkets will start June today as they finished it – a bit listless, a weather eye on the overstretched Chinese market, a growing belief in a US rate rise sometime this year, and increasing concern about the health of the Aussie economy which will be further tested this week.
And then there’s major interest rate decisions, locally (tomorrow) and offshore later in the week, the always important US jobs report on Friday, with the half yearly OPEC meeting, also on Friday, as an added reason for investors, especially in energy and resource stocks, to fret about.
So it’s no wonder the local market will start the week with a small loss according to the share futures market on Saturday morning.
The futures market ended down 17 points for the share price index contract on Saturday morning, pointing to a weak start locally for June.
With the US Fed meeting mid month which is not expected to produce a rate rise, but will release a new set of forecasts to give us a better idea of the timing of the first rate since 2006, we can expect June to be a volatile month.
And if the Chinese market starts turning down, as last week suggested it could very well do, then there may be some very fraught moments ahead this month.
May saw trading bounce all over the place, from boom to doom and somewhere in between. Last week was typical of the month.
US shares down 0.9% last week, and European shares off 2.5%. Chinese shares down 1%, thanks to the slide on Thursday, but Japanese shares rose 1.5% and Australian shares were up 2%.
US stocks ended lower on Friday, finishing the week with modest losses.
But the main indexes recorded a second straight month of gains in May with the S&P 500 and Dow both up about 1% over the month.
The S&P 500 closed down 13.40 points, or 0.6%, lower at 2,107.39 and lost 0.9% over the week.
The Dow lost 115.44 points, or 0.6%, to 18,010.68 and shed 1.2% over the week.
And the Nasdaq Composite ended the session down 27.95 points, or 0.6%, at 5,032 for a drop of 0.4% over the week.
But enough of the early month gains remained for the index to finish 2.6% higher over the month.
European stocks slid on Friday, with the Stoxx Europe down 1.7% to 399.87. The index still notched up a 1% gain for May, but had a weekly loss of 1.9%.
On the country indexes, Germany’s DAX 30 stumbled 2.3% to 11,413.82, bringing its monthly loss to 3.4%. The French market lost 3.2% over the month and 2.5% on Friday alone.
In Athens, the Athex Composite fell 1.4% to 825.38, but eked out a May gain of 0.3%, despite confirmation the economy contracted 0.2% in the March quarter.
For the month, the FTSE 100 in London rose 0.3% after a fall of 0.8% on Friday night. Over the holiday-shortened week it was down by 0.7%.
In Asia, the Tokyo market lost 0.06% on Friday, gained 1.5% for the week and 2.5% for the month with Friday’s end of month economic reports basically positive for the economy.
Despite Thursday’s slide, the Shanghai market was up 3% for the month, but Hong Kong was down 3.6%.
The Shanghai and Shenzhen markets both lost 4% or more in early trading Friday before they steadied and closed on a mixed note.
The Shanghai market was down 0.3% (after touching correction territory in early trading on Friday when the index was down just over 10% at one stage after Thursday’s 6.5% drop).
The Shenzhen market ended the day up 1.3%, while in Hong Kong the Hang Seng index ended the day flat, with traders still watching China and the 20 companies due to float on stockmarkets there in the coming week.
In Australia, the ASX ended the month on a positive note, with widespread gains across all sectors led by the banks and other blue-chip stocks.
The All Ordinaries was up 1.1% for the day, 1.9% for the week, but down a touch for the month.
The ASX 200 index was also up 1.1% for the day and 2% for the week to 5777.2, but the index lost 0.4%.
