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The Aussie market has faded from a better start, with the ASX 200 down by ~0.1 per cent at lunch ahead of what will be a busy week for data in Australia and offshore. This follows a lift in US shares on Friday which rose by 0.3 per cent partly on better data. Despite this morning’s gains, the improvements are starting to fade from intraday highs (up 0.55 per cent on the open).
Local stocks are being helped by strong gains for energy stocks like Woodside (WPL), Origin (ORG), Santos (STO) and Caltex (CTX) which are up as much as 1.7 per cent on a firmer oil price.
Miners like BHP Billiton (BHP), Rio Tinto (RIO) and Fortescue Metals (FMG) are up, shaking off a tumble in iron ore prices. Iron ore slumped by 2.7 per cent or $1.9 to US$69.6/t on news Chinese policymakers ordered some steel mills to halt production until 31 March due to poor air quality in Northern China. Environmental protection measures will continue to guide steel and other metal production this year in China and impact prices.
Taking a step back from this morning’s moves, there has been a lack of enthusiasm and momentum for local equities recently. The ASX 200 is in its third straight month of falls and March so far is the worst month since May 2017 for shares. Geopolitical tensions remain key drivers of markets globally.
Wesfarmers (WES) and Woolworths (WOW) are weights on the market following strong gains for both supermarket chain operators on Friday. WES last week announced its intention to split from its Coles business, creating a separate top 30 (ASX 30) company on the sharemarket which will be predominantly owned by existing WES shareholders. The news was well received on hopes it could allow WES to focus on other growth opportunities and make other acquisitions. WOW rose on hopes it could be disruptive for Coles over the short-term.
Locally this week, a highlight will be the February jobs report which economists expect will result in 17 straight months of job gains in Australia (a record). Kathmandu (KMD), TPGTelecom (TPM), Myer (MYR), Nufarm (NUF) and Sigma (SIP) will release their earnings over the next five days. Offshore, a highlight will be the Fed’s likely lift in interest rates earlyThursday morning at the conclusion of its monthly policy meeting which kicks off tomorrow.
1.4bn shares have changed hands so far today worth $1.2bn. 515 stocks are up, 491 down and 351 are flat.
Published by CommSec