The Aussie market latched onto the ‘lower interest rate’ trade today, and rallied strongly after the employment data dropped at 11.30am – the buying intensified into the close. Unemployment came in at 5.2%, above the 5.0% expected by the market even though +28k jobs were added v expectations of 15k. Full time employment was weak offset by some strength in the part-time figure however overall, the numbers set up a rate cut in June. HSBC the latest to hit the airwaves this afternoon saying
"Despite considerable reluctance to cut the cash rate, and a strong preference for a fiscal policy response, we now expect that the RBA will be forced to cut. With little reason to wait, we now expect the RBA to cut its cash rate in June by 25 basis points to 1.25 per cent, and to cut again in August (after the Q2 CPI) to 1.00 per cent." (source HSBC)
Today’s data the key
A short note this afternoon after one of those really busy days on the desk. Tomorrow morning I’ll look at interest rates but more importantly, stocks that have the capacity to pay special dividends from here.
Overall today, the ASX 200 added +43 points or +0.69% to 6327. Dow Futures are trading down -87pts / -0.34%.
ASX 200 Chart
ASX 200 Chart
· Goodman Property Downgraded to Neutral at Macquarie; PT NZ$1.83
· Goodman Property Cut to Underperform at First NZ Capital
· South32 Rated New Overweight at Morgan Stanley; PT A$4.05
· St Barbara Cut to Underperform at Credit Suisse; PT A$2.72
· Ramelius Downgraded to Sector Perform at RBC; PT A$0.80
· Sydney Airport Cut to Hold at Morgans Financial; PT A$7.61
Never miss an update
Stay up to date with the latest news from Market Matters by hitting the 'follow' button below and you'll be notified every time I post a wire.
Market Matters publishes daily market reports and sends SMS alerts when we transact on our portfolio. To get our latest market views and hear when we take new positions, trial Market Matters for 14 days at no cost by clicking here.