Markets at a glance 10 January
Around the grounds
The S&P/ASX 200 continues in the doldrums to trade relatively flat on this final trading session of the week, as heavyweight miners aren’t enough to offset losses in financials. This as investors continue to digest the weaker-than-expected retail sales data out yesterday stoking the fire for a rate cut as early as next month.
To the details, mining stocks, which make up nearly a quarter of the resource-heavy bourse, are up just shy of 1% as the price of iron ore rebounded overnight. The sub-index is set to finish a third straight week in the green. On the flip side, financials are under pressure as those bets for a rate cut rise. The AXFJ however, is set to end the week higher by some 2%.
Elsewhere, energy has eased despite higher crude prices, and are looking to log three consecutive weeks of gains, gold players, which have been up for four straight sessions, are set for their best week since November last year.
On the local currency market, both the Australian and kiwi dollars have sunk, languishing near two-year lows ahead of a crucial U.S. jobs report tomorrow. More on that later.
In the news
Quick check in on some of the stocks to watch in today’s trade. Australian listed shares of Star Entertainment (ASX: SGR) are again in the news, falling further to hit yet another record low, as investors continue to hit the sell button after the casino operator raised concerns over liquidity and cash after a dismal December quarter.
On the flipside, shares of Insignia Financial (ASX: IFL) are tracking higher after reports Canadian asset manager Brookfield was mulling a bid for the Australian money manager. IFL though has thrown cold water on that speculation saying it was not received any proposals from Brookfield.
Earlier this week Insignia confirmed it had received offers from CC Capital Partners and Bain Capital, with CC’s offer higher than that of Bain.
Finally, Mesoblast (ASX: MSB) shares are in a trading halt pending an announcement on proposed financing. Shares of the Australian biotech were a star performer in 2024, rising a whopping 900% to finish the year at AU$3.10 a share on 31 December.
Going global
To the global currency plays and the US dollar is poised to extend its longest weekly winning streak in over a year, underpinned by rising bond yields and expectations of another set of strong U.S. jobs numbers tonight. The big dollar is up half a per cent against the yen, 1% against the struggling pound, which remain stuck at a 140month low in tandem with a selloff in gilts and concern about British finances.
On that payrolls data, markets are forecasting around 150,000 jobs to be added in December, with unemployment holding steady at 4.2%. Anything stronger will add to the case for few rate cuts from the FOMC and may set off another round of selling in the bond market.
Coming back online, US futures are lower with the S&P and Nasdaq expected to open in the red when trade gets underway on the Wall Street session.
Finally, turning to the global economy, the UN has predicted global economic growth will remain flat at 2.8% in the year ahead, a slower pace than the pre-pandemic average of 3.2%. The report says while there are modest recoveries in the EU, Japan, Britain, and robust performance in some large developing economies, like India, the two top economies, the U.S. and China are holding back overall growth.
On the path of policy for global central banks, the UN says there will likely be a further reduction in benchmarks in 2025 as inflationary pressures ease, tipping global inflation will drop to 3.4% from 4%, offering some relief to households and businesses.
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