What's Affecting Markets Today
Asia-Pacific markets traded lower on Monday as a stronger-than-expected U.S. jobs report dampened hopes for early interest rate cuts by the Federal Reserve.
In China, exports and imports for December outperformed expectations significantly. Exports grew 10.7% year-on-year, surpassing Reuters’ forecast of 7.3%, while imports rose unexpectedly by 1%, defying a projected 1.5% decline. Despite this, the CSI 300 fell 0.22%, closing near its lowest level since September 2024 last Friday.
Investor focus remains on Chinese bond yields after the central bank suspended government bond purchases, leading to a record low for the 10-year bond yield this month. Meanwhile, the onshore yuan hit a 16-month low, and the offshore yuan has been on a multi-month slide since September.
Hong Kong’s Hang Seng Index dropped 1.6%, falling below 19,000 for the first time since September. South Korea’s Kospi declined 0.85%, and the Kosdaq slipped 0.53%. Japan’s markets were closed for a holiday.
This week, key data includes the Bank of Korea’s rate decision on Thursday and China’s Q4 GDP on Friday, alongside Australian unemployment figures.
ASX Stocks
ASX 200 - 8,189.1 (-1.30%)
Key Highlights:
The Australian sharemarket extended losses on Monday following a surprise uptick in US jobs data that dashed hopes for an imminent Federal Reserve rate cut. By late afternoon, the S&P/ASX 200 index had dropped 1.3%, or 111.5 points, to 8182.6.
The S&P 500 closed down 1.5% after US non-farm payrolls reported 256,000 jobs added in December, surpassing the expected 164,000, signaling a potential pause in rate cuts. This triggered a sell-off in Australian banks and technology stocks. Commonwealth Bank fell 2.9%, NAB dropped 2.7%, Westpac lost 2.8%, and ANZ shed 2%. Tech giant WiseTech declined 3.6%.
Retailers were hit hard, with Myer plunging 20.4% following a disappointing trading update, while Premier Investments sank 15.4%.
Energy stocks bucked the trend, rising 2% as Brent crude surged to $US81 a barrel. Woodside climbed 2.5%, and Santos added 2.2%.
Star Entertainment rebounded 18.2% after last week’s 42.1% crash. Insignia rose 2.4% amid acquisition interest, while Novonix fell 5.6%, and NRW Holdings dropped 10.8% on leadership changes.
Leaders
NAN: Nanosonics Ltd (+4.50%)
VUL: Vulcan Energy Resources Ltd (+3.37%)
DYL: Deep Yellow Ltd (+3.13%)
PDN: Paladin Energy Ltd (+2.97%)
MEZ: Meridian Energy Ltd (+2.69%)
Laggards
MYR: Myer Holdings Ltd (-23.14%)
PMV: Premier Investments Ltd (-15.13%)
NWH: NRW Holdings Ltd (-10.37%)
NWL: Netwealth Group Ltd (-8.56%)
CSC: Capstone Copper Corp (-7.62%)
