ASX expected to edge higher, despite mixed leads from overseas markets
The S&P/ASX 200 (XJO) had a rocky ride on Monday, continuing its downward trend from Friday’s fallout in morning trading before staging a comeback to finish up 74 points or 1.4% to 5319 points.
We mentioned yesterday that building approvals for March would be released, and that this information could impact companies that provide services to the construction sector.
While new housing approvals fell 4%, this was better than expected.
However, a number of stocks exposed to the building industry took a hit, arguably because investors anticipate that March data is the thin edge of the wedge with things set to worsen in the coming months.
There were mixed leads from overseas with the FTSE 100 down slightly, while sharp falls were recorded in Germany and France.
The US was also a mixed bag with the Dow just edging into positive territory in the last hour, while the NASDAQ posted a 105 point gain.
The SPI200 indicates the ASX could see another positive day, up 17 points to 5335 points.
Looking across the time zones, Australia fared much better than Asian markets where the Hang Seng was hit hard, tumbling 1030 points or 4.2% to close at 23,613 points.
The Nikkei 225 shed 2.8% or 574 points, closing at 19,619 points.
The Shanghai Composite bucked the trend, increasing 1.3% to 2860 points.
The UK market opened sharply lower with the FTSE 100 slumping to about 5700 points before finishing the day at 5754 points, down 0.2%.
However, the real carnage was in mainland Europe with the CAC 40 plunging 194 points or 4.2% to close at 4378 points.
The DAX didn’t fare much better, shedding nearly 400 points or 3.6% to close at 10,467 points.
While the Dow spent most of the day in negative territory, hitting a low of 23,361 points, a late rally saw it close at 23,750 points, a gain of 0.1%.
The S&P 500 was up 0.4% to 2842 points.
However, the NASDAQ was the star performer, led higher by strong performances across the tech sector as it gained 105 points or 1.2% to close at 8710 points.
As US markets staged their late rally the CBOE Volatility Index started its decline, finishing down 3.3% at 36 points.
On the commodities front, Brent Crude rallied 3.1% to US$27.26 per barrel driving strong gains in the likes of ExxonMobil and Chevron.
There was little movement in the gold price as it continued to fluctuate between about US$1700 per ounce and US$1725 per ounce.
The Australian dollar is fetching just over US$0.64.
The RBA will be releasing its monetary policy decision at 2:30 PM today with analysts generally of the view that the cash rate will remain unchanged.
However, the rhetoric accompanying the RBA’s statement will be closely examined to gain an idea of what may play out in the coming months.
This being the case, there could be some volatility in the Australian dollar.
Short-term positions in small, early stage ASX companies,
with high potential and near term price catalysts.
Focusing on resource exploration, early-stage tech, and biotech.
Exceptional opportunities across a broad range of
early-stage growth sectors with strong management.
Seeking 1,000% plus returns across medium to long-term holds.
Longer-term positions in a variety of sectors.
Seeking strong management where traction is established and have entered into a growth phase.
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.