AUS
NZ
UK
CA
USA
IND
Highlights:
- Futures Down: ASX 200 futures fell 67 points (-0.85%) by 8:30 am AEST, signaling a weak market open.
- US Market Recap: US benchmarks dropped for a third session on Friday, hit by an IT outage and sector-specific news including Netflix's 8 million new Q2 subscribers.
- Today's Watchlist: Energy sector drops with a 2.5% decline in Brent crude; gold and copper prices fall, while defensive sectors outperform amid rising bond yields and market volatility.
ASX 200 Futures: As of 8:30 am AEST, ASX 200 futures are trading 67 points lower, a drop of -0.85%. This signals a likely negative start for the Australian stock market.
US Market Recap: On Friday, major US benchmarks experienced a sell-off for the third consecutive session:
- An extensive IT outage disrupted operations across multiple sectors, including banks and airlines.
- Netflix reported a significant addition of 8 million paid subscribers in Q2, indicating strong performance despite broader market weaknesses.
- Alcoa is set to replace Alumina in the ASX 200 index on Wednesday, marking a notable change in the index composition.
- Macquarie Group issued a broad sweep of upgrades and downgrades for Real Estate Investment Trusts (REITs), which may influence market movements in this sector.
Overnight Markets:
- The S&P 500 and Nasdaq both finished lower on Friday, marking their third straight session of losses.
- The trading session was characterized by a risk-off sentiment. Bond yields increased, the US dollar index rose by 0.2%, and the VIX, a measure of market volatility, reached a near three-month high.
- Defensive sectors such as Healthcare, Utilities, and Real Estate outperformed other sectors, reflecting investors' cautious approach.
Weekly Recap:
- The Russell 2000, which tracks small-cap stocks, rose by 1.68%, showing resilience among smaller companies.
- The Dow Jones Industrial Average gained 0.72%, indicating some stability among large-cap stocks.
- The S&P 500 dropped by 1.97%, reflecting broader market declines.
- The Nasdaq Composite fell by 3.65%, hit particularly hard by losses in the tech sector.
BofA Flow Show Report: The Bank of America Flow Show report highlighted significant inflows into US equities, with $44.8 billion recorded for the week ending July 17. This marks the fourth-largest inflow on record, underscoring strong investor interest. Small-cap stocks attracted $9.9 billion, the second-largest inflow ever for this segment.
What to Watch Today:
1. Energy Sector:
- The energy sector was the worst-performing sector in the S&P 500 on Friday.
- Oil prices saw a sharp decline, with Brent crude falling approximately 2.5%. This drop was driven by concerns over a slowdown in China's economy, renewed hopes for a ceasefire in Gaza, and a stronger US dollar, which tends to weigh on oil prices.
2. Gold and Copper Volatility:
- Gold prices continued to fall for the third straight session on Friday, down 1.8% to $2,406 an ounce.
- Copper prices also ticked lower, declining by 1% to near four-month lows.
- The VanEck Gold Miners ETF, which tracks the performance of companies involved in gold mining, finished 1.2% lower. However, this was an improvement from its session lows of -2.85%, indicating some recovery towards the end of the trading day.
