Markets Overview

  • ASX SPI 200 futures up 0.5% to 7,853.00
  • Dow Average up 0.8% to 38,904.04
  • Aussie down 0.3% to 0.6570 per US$
  • US 10-year yield rose 9.3bps to 4.4016%
  • Australia 3-year bond yield fell 5.9 bps to 3.68%
  • Australia 10-year bond yield fell 7.9 bps to 4.10%
  • Gold spot up 1.7% to $2,329.75
  • Brent futures up 0.6% to $91.17/bbl

Economic Events

  • 11:30: (AU) Feb. Home Loans Value MoM, est. 2.0%, prior -3.9%
  • 11:30: (AU) Feb. Owner-Occupier Loan Value MoM, prior -4.6%
  • 11:30: (AU) Feb. Investor Loan Value MoM, prior -2.6%
  • 16:30: (AU) March Foreign Reserves, prior A$90.5b

The stock market ended the week on a positive note after a blowout jobs report signaled the US economy will continue to power Corporate America — even if that means the potential for still elevated interest rates.

All major groups in the S&P 500 gained, with the gauge rising more than 1%. Wall Street decided to look at the glass half full on Friday based on the premise that if the economy is still so strong, there would be no real urgency for the Federal Reserve to start easing policy.

That triggered another hawkish reprice in the bond market. Treasury yields climbed, with traders dialing back their projections for Fed cuts in 2024 to about 65 basis points — or less than what the central bank forecast last month.

US payrolls swelled by 303,000 in March, topping all estimates. The unemployment rate edged lower to 3.8%, wages grew at a solid clip, and workforce participation rose, underscoring the strength of a labor market that’s driving the economy.

The S&P 500 topped 5,200, though Friday’s advance didn’t prevent the gauge from notching its worst week since January. Meta Platforms Inc. led gains in megacaps. Tesla Inc. closed away from session lows as Elon Musk denied a report saying the carmaker had called off plans for a less-expensive vehicle.

Treasury 10-year yields rose nine basis points to 4.40%. Brent oil held above $90 amid geopolitical tensions.

Other News

Investment into Australia by Chinese private and state-owned companies tumbled in 2023 to the second-lowest level in 18 years, according to a report from KPMG and the University of Sydney.

The analysis estimated that direct investment slid 37% to $892 million from the previous year. In contrast, China’s global outbound investment jumped in 2023, driven by projects in countries participating in President Xi Jinping’s Belt and Road Initiative.

For Australia, there were declines in industries such as commercial real estate and mining that have traditionally attracted Chinese companies, according to the report, whose authors included KPMG’s head of Asia & International Markets Doug Ferguson and its China Business Practice partner, Helen Zhi Dent.

A possible shift in Chinese Belt and Road investment from infrastructure and resource off-take toward processing could herald “competitive challenges” for Australia, the team said in the report.

The data in the report exclude portfolio investments that don’t result in foreign management, ownership or legal control. Also outside the report’s scope are investments stemming from Hong Kong and Macau family offices or private entities that aren’t majority-owned by mainland Chinese corporations.

China-Australia ties frayed under former Australian leader Scott Morrison. Relations began improving after the May 2022 election of Prime Minister Anthony Albanese’s government. Last month, China lifted punitive tariffs on Australian wine exports, signaling an end to a campaign of trade pressure.

China is grappling with a lingering property crisis and weak consumer sentiment, clouding the outlook for the world’s second-largest economy.

(Bloomberg)