Weekly market update - 13th of November 2023
Written and accurate as at: Nov 13, 2023 Current Stats & Facts
Global markets experienced a week marked by contemplation and moderate activity as investors weighed central bank commentary, aligning closely with prevailing expectations. The sense of guarded optimism was evident as the conversation turned to whether interest rates have reached their peak in critical economies. However, the consensus was careful, acknowledging that while the apex may be near, economic data developments hold the keys to future rate movements.
The S&P/ASX 200 increased by a mere 0.1%, with industrials showing modest strength and resources sectors facing a downturn. In the U.S., the S&P 500 and NASDAQ showcased more robust growth, advancing by 1.4% and 2.4%, respectively, as investors maintained confidence in the economic trajectory.
Weekly Performance Insights:
- S&P/ASX 200: Marginal increase of +0.1% for the week with mixed sector performance.
- U.S. Markets: The S&P 500 and NASDAQ climbed, ending the week on a high note with investors optimistic about the economic strength.
Central Bank Influences and Economic Data:
Investors across the globe kept a keen eye on central bank developments. The Reserve Bank of Australia raised its cash rate by 25 basis points to 4.35%, a move prompted by persistent inflation concerns. This was accompanied by the bank's revised inflation forecasts, with an expectation that it will stay near 4% until mid-next year.
The AGM season they brought corporate updates, with industrial companies mostly meeting earnings expectations despite economic headwinds. Banking giants Westpac and NAB released figures slightly below forecasts, spotlighting the challenging balance of revenue growth against rising costs.
Commodity markets saw oil prices extend their decline, reflecting broader market sentiments and future demand expectations.
Macro-Economic Highlights:
- U.K: GDP showed resilience with zero growth against a backdrop of anticipated contraction, but the path to stimulating growth remains a tightrope for policymakers.
- China: Consumer price trends and producer prices indicated a contraction, hinting at persistent sluggishness in the economy.
- U.S: Consumer sentiment dipped, reflecting broader concerns about a potential economic slowdown.
Individual Company Performances:
- Neuren Pharmaceuticals: Shares soared +18.0% following an investor presentation that boosted confidence in the company's growth prospects.
- James Hardie Industries: Reported an impressive Q.2 outcome with an 11.0% rise, outperforming market expectations with strategic price increases and cost management.
- IRESS Limited: Climbed +7.3% in a rebound from historic lows despite recent challenges.
- Xero Limited: Faced a -11.0% fall due to disappointing half-year results, primarily due to slower subscriber growth.
- Coronado Global: Decreased by -11.4%, as higher operational costs and lower coal prices challenged profitability.
- Chalice Mining: Took a -15.7 % hit amidst trade pact discussions that could affect the economics of nickel-cobalt projects.
Looking Ahead:
The upcoming week promises a buffet of economic news with Australian consumer and business confidence data on the table, alongside Chinese industrial and retail statistics. The U.S. and U.K. are set to release their latest inflation figures, which market participants will closely monitor for signs of economic trajectory and potential monetary policy adjustments.
In the face of evolving economic landscapes and shifting market sentiments, investors and analysts will continue to parse through a complex array of data points to chart the course of global finance. With central banks significantly influencing market dynamics, the balancing act between policy and performance remains as crucial as ever.