Transcript generated automatically by AI and may contain errors.
Chapter 1: What factors contributed to the Australian market's six-day losing streak?
The market can't shake off a losing streak as most sectors drag the ASX 200 lower.
And what to expect from tomorrow's key inflation data here in Australia.
Good afternoon, I'm Steve Daglian.
I'm Laura Bessarati.
It's Tuesday the 28th of April. Welcome to the ComSec Market Update.
Well, it's been another rough session for the Australian share market today. So heading into the close, the Aussie market is sliding by roughly two thirds of a percent. That means we're on track to fall for six straight days. And that certainly could mark our longest losing streak since June 2022.
And we're down about 2.5% over that losing streak as well. The market has sank to a three-week low in the process. We've only got a couple of days left now in April. And the gains that we've had so far this month are beginning to not look quite as impressive. In the opening week, I mean, the market was up almost 6%. Now we're up about 2.7% in April.
So the gains have largely halved over the last couple of weeks. Could be worse, though. And I think markets at the moment are just a little cautious, which I think is fair enough.
There is a bit at stake this week from a bunch of central bank meetings, five of the world's largest companies meeting in the next couple of days, heaps of mining and energy stocks in Australia out with their quarterly results, and then inflation data in the next day as well.
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Chapter 2: How are rising oil prices impacting the market and sectors?
And of course, gold prices have been going backwards. They were down about 1% overnight. So the Aussie gold subsector is down roughly 3%. So plenty of those big gold mining names down like Northern Star and Evolution Mining. So if you look at the worst performance list, a lot of mining names, even outside of the gold space as well. So that's really dragging our market lower today.
And look, we heard yesterday that Iran has sent a new proposal over to the US. Now, the White House said US officials are discussing the latest proposal, but maintained red lines on any deal to end the war. And perhaps they're going to come out with something in the next couple of days, but we'll have to wait and see if that counter offer does eventuate.
Let's look at some stocks because there are a few that are making headlines today. One of them is actually Reliance Worldwide, which is up in the order of 3.6%. It actually said that there's not much material change to the outlook for the second half of the year or the full year either. This is an update that it provided just before the war between the US and Iran.
It already flagged the impact from tariffs. Remember those? We don't really talk about tariffs very much anymore. because of everything else that's happening globally, geopolitically at the moment. But as far as tariffs go, Reliance Worldwide, which sells plumbing materials and products, the impact from the tariffs will likely be at the lower end of between 25 and 30 million US dollars.
This is the range it previously had already flagged. It also did comment on the war in the or the closure of the Strait of Hormuz, but that higher oil prices have driven up certain prices, input costs, things like resin, logistics, energy costs as well, which it's offsetting basically by lifting the prices of the products that it sells.
At this point, though, it doesn't expect the war in Iran will significantly impact its profits for the year, but it did warn, as many other companies have, that if the conflict continues and is prolonged, it's something that could impact the outlook for 2027.
Today, we also got the latest weekly read on consumer confidence, and it showed that confidence actually rose slightly, climbing three and a half points to its highest level since mid-March. But don't get excited because if you zoom out, it's still sitting near historic.
lows around its worst level since the series began in 1973, of course, with all of the volatility and uncertainty around the world. The slight lift, though, seemed to be driven by stronger confidence in economic conditions. But look, overall sentiment is still very low.
A standout today on the market is Linus. It's up around 4% or close to it. The Wall Street Journal in the United States reported that the Pentagon is working to secure supplies of heavy rare earths with Linus producing in Malaysia to reduce its dependence in China. Reminder that China very much dominates in the rare earth market, basically controlling almost the entire market there.
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Chapter 3: What are the implications of the upcoming inflation data for the market?
down about 0.8%. It's underperforming other energy stocks today, basically downgraded guidance for how much it reckons it's going to produce over the course of the year, downgrading it by about 5%, which it's blamed in part on some heavy rainfall in central Australia. So it hasn't been able, I guess, to benefit in full from the higher prices that we've seen recently.
Looks like we're going to get a very small move when the US market opens up tonight. We also get a read on consumer confidence, but tomorrow locally, all eyes are going to be on that quarterly inflation report.
Yeah, and that's going to be out at 11.30am Sydney time. It's going to be a very important one, of course, ahead of the Reserve Bank's next interest rate decision, which is going to come next Tuesday, essentially. And that will be at 2.30pm Sydney time. So the hotter this number is, the more likely we are to get, I guess, a rate hike next week.
We've already got roughly a 76% chance of a lift next Tuesday. That's what markets are currently pricing in.
And remember, this is also the March monthly read, which is the first time we'll see how the conflict has impacted the Aussie economy and inflation as well.
Absolutely. So plenty to watch. I think we'll leave it at that, but we'll catch you tomorrow and make sure you tune in to The Morning Podcast with James tomorrow. This podcast is prepared, approved and distributed in Australia by Commonwealth Securities Limited, ABN 60067254399, AFSL 238814. The information does not take into consideration your objectives, financial situation or needs.
Consider the appropriateness of the information before acting and if necessary, seek appropriate professional advice.
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