Global Fundamental Analysis 1/05/2020

Australian Market

US Market

U.S. stocks finished their best month in decades on a downbeat note after data on spending and unemployment further revealed the extent of the coronavirus pandemic’s
damage. The S&P 500 fell 0.9%, reversing Wednesday’s gains when the Federal Reserve reassured investors that it is in no hurry to end its stimulus programs. Despite a choppy month, the index wrapped up April with a gain of about 12.7%.

The Dow Jones Industrial Average, which fell about 288 points, or 1.2%, on the day, is up 11.1% in April. Both indexes turned in their best monthly performance since 1987-but are still down about 10% or more for the year. Stocks have rebounded since the market bottomed March 23, the day the Fed signaled it would do practically anything to save an economy ravaged by the pandemic.

Commodities

Gold futures settled lower in volatile trading, but posted a gain for the month with prices supported partly by growing physical demand and expectations that
global central banks will be compelled to keep stimulus measures in place to dampen the impact of the COVID-19 pandemic.

Gold for June delivery lost $19.20, or 1.1%, to settle at $1,694.20 an ounce. Prices for metals did get a bump after the Fed’s policy actions on Wednesday, which came about a half-hour after the metal’s settlement on Comex.

Oil Futures

Oil prices advanced in volatile trading, lifted by hopes for a rise in fuel consumption as lockdown measures to stop the coronavirus are rolled back.
U.S. crude for delivery in June rose 25% to $18.84 a barrel on the New York Mercantile Exchange, extending a recent stretch of wild swings. The most heavily traded June futures have staged a powerful rebound since dropping to a 21-year low of $11.57 on April 21.

The benchmark crude price started the year above $60 but has crashed with the coronavirus eroding fuel demand. A contract for delivery in May crashed to minus $37.63 a barrel on April 20, the first time in oil-market history futures have turned negative.

Forex

 The WSJ Dollar Index was recently 0.01% lower at 93.10.

European Markets

European sharemarkets fell on Thursday in response to endmonth profit-taking. Banks fell 5.5% after the European Central Bank left most policy settings unchanged. The eurozone economy fell 3.8% in the March quarter, near forecasts of a 3.5% fall. The panEuropean STOXX 600 fell by 2%. The German Dax index lost 2.2%.
The UK FTSE index fell by 3.5%. On London trade shares of Rio Tinto fell 6.6% with shares in BHP down 4.7%

Asian Markets

Earlier in the day in Asia, with markets in Hong Kong and Seoul closed, the Nikkei 225 rose 2.1% in Tokyo and the Shanghai Composite gained 1.3%.
The Nikkei Stock Average rose 2.1% to 20193.69 on improved sentiment following the Fed’s assurance that it will continue with its stimulus programs. China’s stock-market benchmarks posted solid gains before the five-day Labor Day holiday kicks off on Friday, as investors look to the annual legislative meetings in late May for bolder stimulus.

The Shanghai Composite Index closed 1.3% higher at 2860.08 and Shenzhen Composite Index climbed 1.9% to 1763.36.
Malaysia’s benchmark Kuala Lumpur Composite Index closed 2.0% higher at 1407.78, in line with regional gains and higher oil prices. The rally was spurred by positive
developments surrounding potential treatments for Covid-19.

Indian stocks ended higher, in line with most other Asian stock markets, as investors were cheered by the U.S. Fed’s reassurances that it will keep up its stimulus
measures. The benchmark Sensex index rose 3.1% to close at 33717.62.