Markets Overview
- ASX SPI 200 futures up 0.4% to 7,621.00
- Dow Average up 0.6% to 37,986.40
- Aussie little changed at 0.6415 per US$
- US 10-year yield fell 1.2bps to 4.6207%
- Australia 3-year bond yield fell 4 bps to 3.83%
- Australia 10-year bond yield fell 2.2 bps to 4.26%
- Gold spot up 0.5% to $2,391.93
- Brent futures up 0.2% to $87.29/bbl
Economic Events
- 11:00: (AU) Australia to Sell A$800 Million 0.5% 2026 Bonds
A selloff in the world’s largest technology companies hit stocks, with Wall Street traders gearing up for a deluge of results from the industry that has powered the bull market.
Equities extended their slide from a record, with the S&P 500 breaking below 5,000 and the Nasdaq 100 falling over 2%. More than half of the “Magnificent Seven” cohort of tech megacaps will report earnings next week — leaving investors wondering whether those firms are going to live up to the high expectations set for artificial intelligence. Just Friday, a pair of AI darlings — Nvidia Corp. and Super Micro Computer Inc. — sank at least 10%.
Profits for the seven biggest growth companies in the S&P 500 — Apple Inc., Microsoft Corp., Alphabet Inc., Amazon.com Inc., Nvidia, Meta Platforms Inc. and Tesla Inc. — are on course to surge 38% in the first quarter, according to Bloomberg Intelligence. When excluding them, the rest of the benchmark index’s profits are anticipated to shrink by 3.9%.
The S&P 500 saw its sixth consecutive drop — the longest losing streak since October 2022. The plunge in Nvidia wiped out over $200 billion in value. The Nasdaq 100 had its worst day this year. Netflix Inc. tumbled, taking the shine off stellar financial results following management’s decision to stop reporting quarterly subscriber data.
Treasury 10-year yields declined one basis point to 4.62% — almost erasing an earlier plunge of 14 basis points. Oil eked out a meager gain after Iranian media appeared to downplay the effect of Israeli strikes.
Other News
Australia will cut the growth outlook for most major economies, including key trading partner China, when it releases its budget next month, Treasurer Jim Chalmers said.
“Events in the Middle East are casting a shadow over the global economy, compounding the concerns about lingering inflation and weaker growth,” Chalmers said in a statement Sunday. Uncertainty about the global outlook were “central” to talks the treasurer held with international counterparts and central bank chiefs in Washington in recent days, where he attended meetings of the G20 finance ministers, the IMF and World Bank, he said.
Australia’s treasury department forecasts GDP for China, India, Japan, the UK and the US in their budget updates. China’s economic expansion is likely to be around 4% this year, and in 2025 and 2026 — the weakest period of growth since the nation started to open its economy in the late 1970s, Chalmers said.
Japan’s forecast 2024 growth was lowered by a quarter of a percentage point to 0.75% following weaker-than-expected consumption figures, the statement said. Japanese household spending fell 0.5% in February, sliding for a 12th consecutive month, recent data showed.
Chalmers last week said Australia is on track for a second consecutive surplus when he hands down the budget in just less than four weeks’ time.
(Bloomberg)
