Market Update & Important Indicators
U.S. stocks ended the week higher, lifted by shares of financial companies. Bank stocks have been rallying since the firms passed the Federal Reserve's stress tests and some quickly announced higher dividends in late June. Rising government bond yields helped lift banks further this past week, as rising interest rates can boost bank profits. The gains offset losses by energy companies, which were weighed down by a drop in the price of oil. The S&P 500 finished the week up less than 0.1%, with the Financials sector posting a 1.5% gain. The Dow Jones Industrial Average and Nasdaq Composite gained 0.3% and 0.2%, respectively, for the week. On Friday, the Dow industrials added 94.30 points, or 0.4%, to 21414.34. The Nasdaq Composite added 63.61 points, or 1%, to 6153.08 as the recently volatile tech sector swung higher, and the S&P 500 added 15.43 points, or 0.6%, to 2425.18. Financials climbed Friday after Labor Department data showed U.S. hiring picked up more than expected in June, even as wage gains stalled. The jobs report is a key data point for the Federal Reserve that will help the central bank determine its plans for raising short-term interest rates further and reducing its asset portfolio. While jobs growth jumped from the prior month, average hourly earnings growth for private-sector workers was little changed from prior months. The U.S. gold price also lost ground overnight, shedding 1.0% to finish at 1,212.20 US$/oz.
European stocks ended in slightly negative territory on Friday, pushed lower by a slide in oil prices and nagging worries about the potential end of ultraloose monetary policy. The Stoxx Europe 600 fell 0.1% to 380.18, trimming its weekly gain to 0.2%. Friday's decline for the Stoxx 600 marked a second straight loss. Thursday's session ended lower by 0.7% as minutes from the European Central Bank's and Federal Reserve's respective meetings in June fueled fears among traders that the easy-money era in monetary policy is starting to come to an end.
In Asian stock markets, Japan's Nikkei Stock Average fell 0.3%, the lowest weekly finish since late May, while Hong Kong's Hang Seng Index was down 0.5%. Amid Friday's wide gains, there was also a lot of red for the week. The Nikkei and Kospi both fell 0.5% while Hong Kong's Hang Seng dropped 1.6% to notch just its second losing week in 2 months. But China was a rare bright spot, with the Shanghai Composite gaining 0.8% and the main Shenzhen board up 1.1%.
Australian stocks fell for a third day running Friday as investor sentiment soured across the region on a rise in bond yields with the prospect that central banks around the world are dropping their easing bias. The further decline eroded a rally Tuesday, the strongest for the local market in eight months, and left the market modestly lower for the week. Selling was widespread across all industry sector for the day, particularly among the major banks and energy companies. With only about 20 stocks higher, the S&P/ASX 200 declined 55.2 points, or 1%, to finish at 5703.6. That left it down 0.3% this week.
The London Metal Exchange's three-month copper contract shed 0.3% overnight to close at $5,804/t. The other base metals finished mixed. Aluminium prices lost 0.3% to 1,918/t, lead prices rose 0.6% to 2,279/t, tin prices fell 2.1% to 19,675/t whilst zinc prices jumped 0.3% to 2,791/t. Nickel prices fell 1.7% to finish at 8,880/t.
Recent Contacts & Presentations
Metro Mining Ltd (MMI), Paringa Resources Ltd (PNL), Independence Group NL (IGO), MZI Resources Ltd (MZI), Transerv Energy Ltd (TSV), Emmerson Resources Ltd (ERM), Antipa Minerals Ltd (AZY), Echo Resources Ltd (EAR), Sovereign Metals Ltd (SVM), Calidus Resources Ltd (CAI), Great Boulder Resources Ltd (GBR), Finders Resources Ltd (FND), Bionomics Ltd (BNO), Threat Protect Australia Ltd (TPS), Ramelius Resources Ltd (RMS), Zenith Energy Ltd (ZEN), Blackham Resources Ltd (BLK), Top End Minerals Ltd (TND), Northern Star Resources Ltd (NST), Xanadu Mines Ltd (XAM), Dacian Gold (DCN)
Please read Argonaut's Important Disclaimers & disclosures
Log in to the client area below to download the full Morning Note PDF