United States
US equity indexes were little changed at the start of the week, with prices fluctuating above and below the flatline as traders awaited a busy schedule of economic data releases and corporate earnings. Markets are particularly focused on upcoming job numbers and quarterly results from major tech companies, with 180 S&P 500 companies scheduled to report this week. Tariffs, which have remained a concern over the past month, continued to linger. Treasury Secretary Bessent noted that a deal with India could soon be reached but provided little new insight on negotiations with China, stating that the next move was up to Beijing.
The S&P 500 edged up 3 points (+0.06%) to close at 5,528.75, while the Dow Jones Industrial Average rose 0.28% to 40,227. The Nasdaq Composite slipped 0.10% (-16 points) to finish at 17,366.13.
Movements in major stocks were generally muted on Monday. Nvidia fell 2.05% to USD 108.73 following reports that Chinese competitor Huawei Technologies is preparing to test its newest artificial intelligence processor, aiming to replace some of Nvidia’s high-end chips. Google declined 0.87% to USD 162.42, while Microsoft rose 0.41% to USD 210.14.
Boeing gained 2.44% to USD 182.30 after receiving positive broker upgrades, reflecting progress in addressing supply chain issues and recovery efforts following two challenging years. The aerospace and defence sectors were among the stronger performers, with Northrop Grumman also advancing 2.14%.
In bond markets, US yields edged lower, with the 10-year Treasury yield falling 3 basis points to 4.21% and the 2-year yield declining 5 basis points to 3.69%. Investors are awaiting the US Treasury’s update on second-quarter borrowing needs, expected on Wednesday. The Treasury is projected to raise approximately USD 514 billion, with a significant portion expected to be issued in shorter-term maturities.
Meanwhile, the US dollar weakened, falling 0.5% on the Bloomberg Dollar Spot Index and on track for its biggest monthly drop since July last year. Against the Japanese yen, the dollar declined over 1% to trade at 142.09.
Europe
A more positive outlook from European investors saw the Euro Stoxx 600 rise 0.53% at the start of the week, gaining 2.74 points to close at 523.19. Most sectors finished higher, with only two posting marginal losses. Healthcare led the gains, advancing 1.02%.
In the UK, the FTSE 100 added 0.02% to finish at 8,417.34, marking its 11th consecutive day of gains. The upbeat sentiment across European markets was supported by easing tariff tensions and news that Russia had declared a three-day ceasefire in Ukraine to commemorate the 80th anniversary of victory in World War II.
Healthcare stocks were among the strongest performers, with Novo Nordisk rising 2.7% and AstraZeneca up 1.2% ahead of its earnings report due on Tuesday. Merck also climbed 3% after announcing the acquisition of Springworks Therapeutics, a move aimed at strengthening its position in the US market. The acquisition, funded through a combination of cash and new debt, is expected to boost Merck’s earnings from 2027 onward.
The banking sector was well supported, rising 0.9% for the day. Italian lender Banca Generali received a surprise €6.3 billion takeover offer from Mediobanca, fuelling investor interest ahead of upcoming results from HSBC, Deutsche Bank, and Societe Generale later in the week.
Shares in food delivery service Deliveroo surged 16.5% after the company confirmed it had received a takeover proposal from US-based DoorDash earlier this month.
Meanwhile, bond yields moved higher. The German 10-year bund yield rose 5 basis points to 2.52%, while the UK 10-year gilt yield increased by 3 basis points to 4.51%. Reports also surfaced that the German government had sent a letter to the European Commission requesting an exemption from EU borrowing limits to support its proposed increase in defence spending.
In currency markets, the euro continued its advance, with EUR/USD gaining 0.52% to trade at 1.1424.
Australia
Early optimism at the start of the week, driven by stronger performances across global equity markets, faded over the course of Monday’s session. The ASX 200 closed the day at 7,997.10, up 0.36% with a gain of 28.90 points. Materials was the only sector to finish lower, while technology and energy led the gains.
The market opened strongly, surging more than 1% higher, but enthusiasm was tempered as profit warnings from Brambles and Flight Centre weighed on sentiment.
Technology stocks outperformed, taking their lead from gains in US tech peers. Xero rose 1.88% to $159.52, while NextDC added 2.52% to close at $11.40. Energy stocks also advanced, supported by higher oil prices and hopes for an easing in trade tensions. Woodside climbed 1.75% to $20.36, now trading over 9% above the lows seen earlier this month amid tariff concerns. Santos rallied 2.21% to $6.01.
The materials sector lagged as gold miners retreated following a pullback in the gold price from record highs. Newmont fell 1.27% to $84.12, and Evolution Mining dropped 1.13% to $7.90. Bulk miners such as BHP (-1.05%) and Fortescue (-0.32%) were also weaker, despite slightly higher iron ore prices and supportive comments from Chinese officials that hinted stimulus may be on the horizon if needed
Healthcare extended its recent rebound, finishing higher for a third consecutive day, up 0.94%. Pro Medicus gained 3.72% to $218.63, while ResMed rose 2.36%. However, Telix Pharmaceuticals fell sharply, down 6.58% to $26.68, after the US FDA declined to approve its imaging agent for brain cancer treatment in its current form.
In financials, there was rotation out of CBA, which fell 1.14%, and into the other big banks. NAB rose 1.68% to $35.70, ANZ gained 1.63%, and Westpac advanced 0.81% to $32.30.
Brambles downgraded its outlook, citing weaker US consumer demand amid ongoing economic uncertainty. CEO Graham Chipchase warned that these conditions are likely to persist through the June quarter. Brambles shares dropped 5.03%, or $1.05, to close at $19.83. Flight Centre also lowered its full-year forecast by 17%, equivalent to a $70 million downgrade, as new US policies impacted transaction volumes. However, the company announced a positive $200 million on-market buyback program to commence on May 12, which helped the stock recover from an initial 50-cent drop at the open to finish the day up 1.04%, or 13 cents, at $12.59.
In bond markets, yields moved lower. The 10-year yield fell 6 basis points to 4.16%, while the 2-year yield dropped 3 basis points to 3.24%. Traders are now focused on the upcoming quarterly CPI data due Wednesday, where economists expect the trimmed mean inflation rate to ease to 2.8% from 3.2%, moving within the RBA’s target range.
Trading overnight has seen the ASX200 futures oscillate in a 50-point range finishing the session with a small 14 point gain the equivalent of 0.17%. The AUDUSD continues to move higher adding 0.58% to 0.6432.
Commodities
Oil prices retreated on Monday as concerns over rising supply and slowing economic growth weighed on the recent buying momentum. West Texas Intermediate (WTI) fell 1.86% to US$61.85, down US$1.17, while Brent crude dropped 1.81% to US$65.66. The market remains focused on the same key themes from last week, including expectations of an OPEC+ production increase, which is likely to be confirmed at the group’s upcoming meeting on May 5. Adding to the cautious sentiment, both BNP Paribas and Barclays released reports suggesting that lower oil prices are likely to persist.
Meanwhile, nuclear negotiations between the US and Iran continued in Oman this week, overshadowed by a deadly explosion in Iran’s port city of Bandar Abbas, which resulted in multiple casualties.
In industrial metals, copper and iron ore trading was relatively subdued as investors awaited further developments on US-China trade negotiations and speculation around additional Chinese economic stimulus. Copper gained US$4 to close at US$9,378 per tonne on the London Metal Exchange, while iron ore futures rose by 55 cents (0.56%) to finish at US$98.45 in New York. In a statement, Zhao Chenxin, Vice Head of the National Development and Reform Commission (NDRC), reiterated the Chinese government’s confidence in meeting its 5% growth target for 2025 despite tariff pressures and indicated that further policy support could be introduced in the second quarter if needed.
Gold prices rebounded after early losses, rising US$24.73 (0.74%) to close at US$3,344. The recent pullback in gold, driven by calmer market conditions and profit-taking, has been seen by some investors as a buying opportunity. A weaker US dollar also supported demand for the precious metal. Silver was slightly higher, adding 6 cents to close at US$33.17.
Economic Calendar
US:
- House Price index (Feb) – 12:00am
- JOLTS Job Openings (Mar) – 1:00am
This article was written by Paul Darwell, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
