AUS
NZ
UK
CA
USA
IND
Highlights
- Setting a new 50-day low, ASX 200 closed this week's trading 1.25% lower at 6,932.00 points.
- All the eleven sectors closed lower, A-REIT leading losses.
- Investor sentiments were dented due to the weak performance of US stocks and European indices.
Investors' sentiments have been dismal recently, particularly due to the central banks' continuous rise in interest rates in a bid to tame inflation. Given the current situation, investors seem clueless about the future, and share market volatility is likely to persist in the coming days.
US stocks edged lower on Thursday as investors awaited key inflation data, the release of which is due today. The data on the US Consumer price index for May will give the traders some hints about the pace of the Fed's interest rate increase in the upcoming months.
Meanwhile, in another latest development, the European Central Bank (ECB) joined many of its peers, unveiling its plan to raise interest rates. In Europe, government spending has been restrained, and the economic recovery has also been slow. Inflation has reached beyond energy and food prices, broadening to a range of goods and services. The ECB has stated that it would raise its key rates by 25 basis points in July and then again in September, probably by a bigger margin.
©2022 Kalkine Media®
How did ASX 200 perform?
Coming to the local bourse’s performance before a long weekend- in the opening minutes of trade, the benchmark index ASX 200 was down 0.90% at 6,956.40 points following a poor handover from Wall Street as investors awaited inflation data and following a rate hike by the European central bank.
On the sectoral front, barring the healthcare sector, all other ten sectors traded red in the opening trade session. Utilities, materials, information technology, and energy, along with other sectors, resulted in losses in the broader market. The fall in commodity prices impacted the domestic mining and energy stocks following the announcement of new lockdown measures in China. Oil prices were also lowered marginally. Meanwhile, gold prices fell owing to the firmer dollar and elevated Treasury yields.
Eventually, setting a new 50-day low at market close, the ASX 200 closed 1.25% lower at 6,932.00 points. All 11 sectors ended lower today, where the A-REIT, consumer discretionary, energy, financial and other sectors led the losses.
Who gained? Who lost?
Xero Limited (ASX:XRO), Healius Limited (ASX:HLS), and James Hardie Industries Plc (ASX:JHX) led the pack of gainers today, with 4.026%, 2.127%, and 1.661% gains, respectively. On the flip side, PointsBet Holdings Limited (ASX:PBH), and Sims Ltd. (ASX:SGM) were the top losers, falling 5.786% and 5.746%, respectively.
Asian and global market
Extending yesterday's losses, all three US indices closed lower on Thursday. The S&P 500 declined 2.38% at 4,017.82 points, the tech-heavy Nasdaq Composite Index dropped 2.75% to 11,754.23 points, while the Dow Jones Industrial Average closed 1.94% lower at 32,272.79 points. Meanwhile, the pan-European Stoxx Europe 600 dropped 1.36% at 434.38 points.
Chinese shares closed down Thursday, with growth stocks leading losses after parts of Shanghai started imposing fresh COVID-19 curbs.
Today, Asian shares tracked a global equities selloff as MSCI's broadest index of Asia-Pacific shares outside Japan dropped 1.2% in the early trade.
The existing scenario has forced us to think about whether a hike in interest rate will tame inflation or if there are other ways also. For the greater good, more possibilities should be searched, and collective efforts should be made to eliminate all those factors which have brought the economy to the current situation. It is also to be noted that the Fed's June meeting, expected to occur next week, will see a rise in interest rates by half a percentage point.
