US equities were modestly on Monday ahead of key economic data this week, as well as Easter which will see US markets closed on Friday.
United States
The S&P500 edged -0.31% lower with the majority of sectors lower, weighed by technology -0.52%, industrials -0.68% and financials -0.29%. The Dow Jones was also -0.41% weaker along with the Nasdaq Composite -0.27% while the Russell 2000 rose 0.10%. Tonight, investors will be focused on the latest durable goods orders for February expected to show a 1.1% increase as well as consumer confidence for March forecast to improve modestly. In data overnight, new home sales for February declined -0.3% over the month following a revised higher 1.7% in January.
The main focus later this week will be the final reading of Q4 2023 GDP, US PCE inflation data on Friday, as well as a speech by Jerome Powell. Analysts at Morgan Stanley note “reflation trades are coming back into vogue” adding that energy large capitalisation stocks are a normal late cycle winner, and despite some recent underperformance the sector is showing strong relative performance and improving breath recently.
Europe
European equities were flat overnight with no major economic data to guide investors. The Euro Stoxx 600 edged up 0.04% along with the DAX 0.3%, the FTSE100 was -0.17% lower and the CAC was unchanged. Tonight, the latest consumer confidence for Germany in April is expected to show a modest decline to -27.9 from -29 previously with no other notable data releases.
Australia
The ASX200 is expected to open lower this morning with ASX200 futures -29 points lower or -0.37% to 7,836. The index started the week on a positive note, up 0.53% with most sectors higher as gains were driven by materials 0.7%, real estate 1.76% and health care 1.01%. Today, Westpac’s consumer confidence for March will be released at 10:30 AEDT, followed by a speech from the RBA’s Connolly at 13:20 AEDT. Shares in FMG were given a boost of 3.5% after Chairman Andrew Forrest said the company was looking to develop its copper assets following a surge in copper prices. The board of McGrath has backed a takeover offer from Knight Frank & Bayleys at $0.60 per share resulting in a 24.5% jump in shares. Shares in MMA Offshore, the oil and gas contractor also gained 10.6% after receiving a takeover offer for $2.60 per share.
Commodities
Oil prices were higher overnight with both WTI and Brent crude up 1.53% and 1.42% respectively. Cocoa futures climbed 7.94% overnight with prices up over 50% in a month amid a supply crunch. Iron ore futures were up 0.39% on Monday although slightly lower by -0.19% this morning, with copper up 0.33%. Gold rose 0.28% to US$2,171 an oz, silver was -0.04% lower while Bitcoin surged 7.15%.
Economic Calendar
26th March 2024
Australian Consumer Confidence (MoM Mar) 10:30
RBA Connolly Speech 13:30
German Consumer Confidence (MoM Apr) 18:00
This article was written by James Woods, Portfolio Manager, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
