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Wall Street closed lower across the board on Friday as investors assessed the August jobs report which was released on Friday morning. The S&P500 fell 1.73% to post its worst week since 2023 with a 4.3% decline over the 5-trading days, while the Nasdaq tumbled 2.55% on Friday and the Dow Jones ended the day down 1.01%. The jobs data out for August on Friday indicated non-farm payrolls rose by 142,000 compared to economists’ expectations of 161,000, but the unemployment rate fell to 4.2%, painting a mixed picture about the strength of the US jobs market. Investors took the weaker-than-expected reading in non-farm payrolls as a signal of economic weakness and as a result sold out of equities on Friday.

Over in Europe, markets closed Friday’s session lower in the worst week since the early August slump as the US jobs report clouded investor sentiment around global economic stability. The STOXX600 fell 1.15%, Germany’s DAX lost 1.48%, the French CAC fell 1.07% and, in the UK, the FTSE100 ended Friday’s session down 0.73%.

Across the Asia region on Friday the sea of red mostly extended across the region as key economic data weighed on investor sentiment including Japan’s household spending data for July rising just 0.1% on the previous year, compared to the 1.2% rise economists were expecting. Japan’s Nikkei fell 0.72%, South Korea’s Kospi Index lost 1.21% and China’s CSI index ended the day down 0.81%.

Locally on Friday the ASX200 rose 0.4% with the bankers driving the positive close to offset some of the heavy losses experienced this week. Energy stocks tumbled over 3% on Friday, extended the week’s losses amid the volatile price of oil, while consumer discretionary stocks rallied 1% on the final trading session of last week.

Materials stocks came under pressure on Friday after China’s steel advisory group advised mills to be cautious on boosting outlook on fears of subdued demand and subdued pricing. Therefore, impacting iron ore prices late last week and the local miners were sold off as a result.

Strike Energy soared almost 9% on Friday in the days after the gas exploration and development company released plans to expand the Eastern Perth Basin with major discoveries at its Erregulla Deep-1 exploration well.

What to watch today:

• Ahead of the first trading session of the new trading week, the SPI futures are expecting the ASX to open the day down 1.28% following the Wall St slide last week.
• On the commodities front this morning, oil is trading 0.80% higher at US$68.20/barrel, gold is up 0.41% at US$2497/ounce and iron ore is up 0.34% at US$91.61/tonne.
• AU$1.00 is buying US$0.66 cents, 50.79 British Pence, 94.86 Japanese Yen, and NZ$1.08.

Trading Idea:

• Bell Potter has increased the 12-month price target on GrainCorp (ASX:GNC) from $9.90 to $10.20 and maintain the buy rating following the release of the ABARE September 2024 east coast winter crop forecast reflecting a 6% upgrade relative to the record June 2024 estimate to 28.8million tonnes. The consensus EBITDA FY25 expectations for GNC of $320m imply an outcome consistent with GNC’s through-the-cycle EBITDA projection, which appear conservative especially if the basis trade emerges over harvest which Bell Potter would expect to occur on a winter crop of this magnitude.