Markets Overview
- ASX SPI 200 futures up 0.9% to 6,559.00
- Dow Average up 2.1% to 31,288.26
- Aussie up 0.6% to 0.6789 per US$
- U.S. 10-year yield fell 4.3bps to 2.9152%
- Australia 3-year bond yield fell 0.7bps to 2.98%
- Australia 10-year bond yield fell 0.3bps to 3.41%
- Gold spot down 0.1% to $1,708.17
- Brent futures up 2.1% to $101.16/bbl
Economic Events
Stocks may get some support Monday after Wall Street ended on a high note last week, but China’s economic malaise and a US dollar strength remain stumbling blocks.
Futures rose for Australia and Hong Kong, while Japan is shut for a holiday. US contracts edged higher in early trading after Wall Street snapped a five-day slide as banks led gains after some solid results.
Cash Treasuries won’t trade in Asia due to the Japan holiday. They advanced Friday as traders cut bets on a bigger Federal Reserve hike next week. A yield curve inversion continues to signal growth is under threat.
A drop in US consumer long-term inflation expectations eased some fears that price pressures are becoming entrenched, while strong retail sales underscored a resilient economy despite tightening monetary policy.
The dollar was mixed in early Asian trading. A gauge of the greenback’s strength has dipped from a record high.
China will be closely watched after policy makers pledged stronger support for an economy hobbled by Covid-19 lockdowns and a deepening property crisis.
Oil was trading below $100 a barrel. The market is digesting slowing demand and the whether supply will be increased after President Joe Biden’s visit to Saudi Arabia.
Other News
Australia will reintroduce support payments for workers forced to isolate after contracting Covid-19 as case numbers rise during the southern hemisphere winter.
Regular meetings between the national government and the country’s key regional leaders will also resume through September under efforts to respond to the emergence of the highly contagious BA.4 and BA.5 omicron subvariants.
“When you get the health outcomes right you protect jobs and protect the economy,” Prime Minister Anthony Albanese told reporters Saturday in Sydney. The support payments will continue until Sept. 30, he said.
Australia last month halted the assistance program, which offers eligible recipients as much as $750 a week if they lose work as a result of virus isolation requirements. Residents who test positive need to isolate for 7 days under current rules.
Cases are forecast to increase in the coming weeks and peak in August, Albanese said.
