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Market Overview: Monday Morning Wrap
As of 8:30 am AEST, ASX 200 futures have decreased by 32 points or 0.37%.
Key Highlights:
- Major US indices experienced a significant decline following weak employment figures for June and downward revisions for the previous two months.
- Amazon’s stock plummeted by 8.2% after its cloud business failed to meet analyst expectations.
- The dismal employment data increased the probability of a 25 basis point interest rate reduction by the Federal Reserve in September, rising to 89.1% from 61.9% last week.
Overnight Summary:
Date: Mon 04 Aug 2025, 8:22 am AEST
Major Indices:
| Index | Value | Change |
|---|---|---|
| S&P 500 | 6,238 | -1.60% |
| Dow Jones | 43,589 | -1.23% |
| NASDAQ Comp | 20,650 | -2.24% |
| Russell 2000 | 2,167 | -2.03% |
Country Indices:
| Country | Value | Change |
|---|---|---|
| Canada | 27,020 | -0.88% |
| China | 3,560 | -0.37% |
| Germany | 23,426 | -2.66% |
| Hong Kong | 24,508 | -1.07% |
| India | 80,600 | -0.72% |
| Japan | 40,800 | -0.66% |
| UK | 9,069 | -0.70% |
Commodities (USD):
| Commodity | Value | Change |
|---|---|---|
| Gold | 3,362.51 | -0.07% |
| Copper | 4.4301 | +0.32% |
| WTI Oil | 67.26 | -0.57% |
Currency:
| Currency Pair | Value | Change |
|---|---|---|
| AUD/USD | 0.6466 | -0.09% |
Cryptocurrency:
| Crypto | Value | Change |
|---|---|---|
| Bitcoin (USD) | 114,378 | +1.25% |
| Ethereum (AUD) | 5,407 | +2.34% |
Miscellaneous:
| Item | Value | Change |
|---|---|---|
| US 10 Yr T-bond | 4.22 | -3.21% |
| VIX | 20.38 | +21.89% |
US Sectors Performance:
| Sector | Change |
|---|---|
| Health Care | +0.58% |
| Consumer Staples | +0.53% |
| Utilities | +0.11% |
| Real Estate | -0.26% |
| Materials | -0.75% |
| Industrials | -1.46% |
| Communication Services | -1.65% |
| Financials | -1.76% |
| Energy | -1.77% |
| Information Technology | -2.07% |
| Consumer Discretionary | -3.59% |
Market Insights:
- US benchmarks closed significantly lower, with technology stocks like Amazon and Apple notably underperforming.
- The recent US jobs report revealed only a 73,000 increase in July, significantly below the anticipated 115,000, prompting concerns about economic momentum.
- HSBC’s forecasts indicate increasing expectations for a Federal Reserve rate cut later in September, now perceived as highly likely.
Stock Highlights:
- Apple reported a revenue increase driven by robust iPhone sales, despite potential impacts from tariffs.
- Amazon’s guidance for operating profit disappointed, alongside a slowdown in its cloud division revenue growth.
- Berkshire Hathaway’s profits dropped amid concerns over trade policy effects.
Central Banks and Tariffs:
- The Bank of England may consider rate cuts this week, despite inflation showing signs of an uptick.
- Recent tariff developments include increases from American authorities, raising concerns about potential effects on economic growth.
Economic Indicators:
- July’s non-farm payrolls fell well short of expectations, with notable downward revisions for previous months indicating a slowdown in job growth.
- The ISM manufacturing PMI contracted at its fastest rate in nine months. Respondents expressed significant concern over escalating tariff costs and their effects on production and investment.
ASX Outlook:
- Market watchers are keenly observing the local response amid a backdrop of significant tech sector weakness.
- Upcoming reports and earnings announcements may drive further market movements, particularly as economic conditions continue to evolve.
What to Watch Today:
- Continued weakness is expected in the tech sector.
- The potential for a market rotation into more stable sectors like Healthcare and Staples may provide some support against a backdrop of increased volatility.
Key Events:
- Trading Ex-Dividend:
- Mon 4 Aug: None
- Tue 5 Aug: Australian Foundation Investment Company; BKI Investment Company
- Thu 7 Aug: Djerriwarrh Investments
No major economic releases are expected today, but investor sentiment will likely be influenced by the previous week’s performance and any emerging news from corporate earnings or economic indicators.
