Weekly Wrap 22 November: Market movements this week

Transcript: Weekly Wrap 22 November

The ASX soared to a fresh record high this week which had many market participants questioning how much steam is left in the record setting rally tank. The drivers of the record high on Tuesday were the Nasdaq’s rally on Wall St on Monday, optimism of greater stimulus out of China and gold miners rebounding on a rise in the price of the precious commodity.

Since Tuesday though, the ASX pared gains in-line with the US pullback as the so-called Trump rally is showing signs of easing. Rising geopolitical tensions centred on Russia also weighed on the market this week with volatility among key commodity prices. The price of gold recovered some ground this week as the USD slightly weakened, while the price of oil eased on growth in US crude inventories.

Quarterly results and trading updates also weighed on investor sentiment this week with mixed outlooks across key industries. Accent Group tumbled on Thursday after the fashion house warned that margins are under pressure amid elevated promotional activity required to move high levels of inventory.

The theme from retailers this quarterly reporting season centres around margin depreciation, increased promotional activity and declining demand. KMD Brands fell over 3.8% on Tuesday following the Rip Curl parent company warning of cautious consumer sentiment after posting a decline in quarterly sales. Retailers have also begun offering black Friday sales early across the board in a bid to reduce inventory levels.

TechnologyOne shares did most of the heavy lifting for our tech rally on Tuesday with a gain of 10.1% after the SaaS company posted a 15% increase in full-year net profit to $118m while revenues rose 17%.

The most traded stocks by our clients this week were Silex Systems and CSL. Clients also bought into McMillan Shakespeare, Telstra Group, BHP, APA Group, and Paladin Energy while taking profits from Woolworths, CBA, and Wesfarmers.

The most traded ETFs by our clients this week were led by Australian Equities Strong Bear Hedge Fund, iShares S&P 500 AUD ETF, and Vaneck Bitcoin ETF.

On the economic calendar front next week Australia’s monthly CPI indicator data for October is out on Wednesday, while overseas, US core PCE, durable goods orders, GDP growth rate for Q2 and personal spending are out later in the week which will paint a clearer picture about inflation at home and in the US.