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Our team compiles this daily market report from global sources to highlight key market updates and what they mean for your investment portfolio.
Overnight Market Highlights:
Wall Street tumbled overnight.
Dow Jones S&P-500 Nasdaq
-1.35% -1.37% -1.80%
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ASX is set to fall this morning.
🇺🇸 US Market Overview:
The Update: Inflation data in the US came in hotter than anticipated overnight. The consumer price index rose 0.3% in January from December. CPI was up 3.1% on an annual basis. Economists polled by Dow Jones expected CPI to have increased by 0.2% month over month in January and 2.9% from a year earlier. Core prices, which exclude volatile food and energy components, rose 0.4% month over month and 3.9% from a year ago. Core CPI was expected to have increased 0.3% in January and 3.7% from a year earlier, respectively. Super core services, which strips out rental inflation, jumped 0.9 percent in January. Source: CNBC, AFR.
The Impact: Wall Street's main indexes tumbled on Tuesday after a higher-than-expected consumer inflation reading pushed back market expectations of imminent interest rate cuts, driving U.S. Treasury yields higher. As mentioned in yesterday's morning report, the effect of a hot CPI read can be seen overnight within the US markets. Markets fall heavily, treasury yields have risen amid a sell-off of bonds, and traders have reduced their bets on a May rate cut of 25 basis points from about 58% to 38%. The yield on the US 10-year note spiked above 4.3 percent, more than 40 basis points higher than a week ago. Source: Reuters, AFR
🇦🇺 Australian Market Overview:
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ASX futures up 16 points or 0.2% to 7580.
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Commonwealth Bank’s cash profits have fallen 3 percent in the first half of the financial year to $5 billion as profit margins continued to suffer from competition in the mortgage market. The bank announced it will pay a $2.15 per share dividend. Source: AFR
🇪🇺 European Market Overview:
European markets closed lower on Tuesday as investors assessed incoming corporate earnings reports and a key U.S. inflation print. Losses deepened after new figures showed U.S. inflation rose by more than expected in January. Source: CNBC
📈 Global Commodities Update:
Oil prices rose after the United States, according to sources, rejected Russian President Vladimir Putin's suggestion of a ceasefire in Ukraine. U.S. crude rose 95 cents to settle at $77.87 a barrel, while Brent crude 64 cents to $82.64. Source: Reuters
⚡ Global Renewable Energy News:
Last week, UK Labour leader Keir Starmer caused a stir in Westminster by abandoning a commitment to allocate £28 billion (equivalent to $54 billion) annually for climate-related policies. The revised spending plan now stands at £15 billion, although it hasn't been completely discarded. Throughout Europe, there's a prevailing perception that the post-pandemic and post-Ukraine cost-of-living crisis has rendered the energy transition challenging for politicians seeking re-election and companies dealing with increased capital costs. However, the current impact seems to be more about slowing down the energy transition rather than fundamentally altering its trajectory. Source: AFR
📚 European Market Report by Jack Colreavy:
The latest UK stock shorts have hit the newswires this week with oil & gas exploration firm Petrofac (LSE: PFC) topping the list as the most shorted stock. Despite the firm’s stock is in the dundrums, down ~65% over the past 12 months, it still has an outstanding short sale of 11.5% of total shares reinforcing the view that hedge funds think there is more to go. Other companies in the short report paint a picture of the current macro environment in the UK with the inclusion of home improvement supplier Kingfisher (LSE: KGF), financial services firm Hargreaves Lansdown (LSE: HL), and fashion brands ASOS (LSE: ASC) and Burberry (LSE: BRBY).
📬 Market Insight by James Whelan:
A One for your Watchlist: I had a little tip come across my desk just recently. MMA.ASX. Silver/lead resource in northwest Queensland. Drill results have been good with the potential for it to be a major resource. RDM owns over 50% of it and this is just a sneaky tip to put it on the watchlist, maybe keep some in a bottom drawer if you're that way inclined.
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