• The ASX closed slightly lower on Monday
  • Tech sector led the bourse today
  • A bust week for central banks including the Fed’s rates decision on Wednesday

 

The ASX edged 0.1% lower on Monday as investors braced for the Fed’s rates decision later this week.

The market struggled for direction as no major economic reports were scheduled for release today.

Regionally, New Zealand reported a $NZ0.475 billion trade deficit against forecasts for a $NZ1.1 billion shortfall.

Elsewhere, China’s Shanghai stock index rose almost 1% on the first day after the week long lunar holiday.

On Friday, Coal (ICE-GC Newcastle) rose to trade above $US355.0/t. LME (3mth evening) copper, nickel and aluminium were pushed lower.

The Aussie dollar maintained its exchange rate of US70.9c as traders take bets on the likely movement of the Fed’s cash rate, expected to be +25bp.

“Chairman Jerome Powell and his colleagues are unlikely to signal that they have reached the terminal Fed Funds rate at this meeting,” said Daniel Moss, market analyst at Vantage Markets.

“A more likely scenario would see the committee push back on market pricing that suggests that the central bank will have to cut rates into the tail-end of this year.”

Central Bankers in the UK and EU will also keep investors on their toes this week.

The Bank of England will meet on Thursday and is expected to hike its benchmark interest rate by 50-basis points for the second consecutive meeting.

“The European Central Bank will likely follow in the footsteps of the BoE and raise interest rates by 50-basis points as it desperately attempts to reign in record-high consumer price growth,” said Moss.

Meanwhile, Adani Enterprises has hit back at the Hindenburg report which has accused the conglomerate of fraud.

In a 413-page rebuttal, Adani said Hindenburg committed “calculated securities fraud”.

Here’s a full text of the rebuttal.

Back to the ASX, the Tech sector led after jumping by more than 2.5% today. Sector leader WiseTech (ASX:WTC) rose 5.5% on no particular news.

And looking ahead to tonight’s session, expect to see the release of EU consumer confidence and EU services and industrial sentiment.

 

BIG CAP WINNERS

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Lynas Rare Earths (ASX:LYC) rose 5% after posting a 42% QoQ jump on sales. The company produced 4,457 tonnes of rare earth oxide, up 27% QoQ.

Seek (ASX:SEK) and Xero (ASX:XRO) rose 4% each on tech sentiment.

 

BIG CAP LOSERS

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Insurance Australia Group (ASX:IAG) fell 3.5% and  Suncorp (ASX:SUN) after both warned that claims from the ongoing floods in New Zealand would climb.

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