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The release of the Federal Reserve’s meeting minutes sent Wall Street into sell-mode on Wednesday in this shortened trading week as investors digested the minutes including the outlook for further tightening of monetary policy. Also adding to the negative sentiment on Wall St was data released on Wednesday morning showing factory orders were weaker than expected in May. Investor sentiment may also waver later in the week when a batch of employment data is released which will enable insights into the strength and tightness of the US labour market to date. The Dow Jones fell 0.38% on Wednesday while the S&P500 lost 0.2% and the Nasdaq dropped 0.18%.
Over in Europe, markets in the region closed lower on Wednesday as investors shifted focus back to weakening global growth outlook and recessionary concerns. PMI figures for June in the eurozone showed business output for the month contracted as services growth eased despite easing inflationary pressures. This combined with China’s service sector activity also slowing considerably has investors worried about slowing global economic growth. The STOXX600 fell 0.7%, Germany’s DAX lost 0.63%, the French CAC fell 0.8%, and in the UK, the FTSE100 fell 1.03%.
The RBA rate pause-driven rally of yesterday was very short-lived as the key index closed 0.35% lower on Wednesday. The ASX traded in negative territory for almost all of yesterday’s session weighed down by sharp losses for financial, healthcare and energy stocks, while Telecommunications and Utilities stocks offset some of the heavy losses on the market yesterday. CSL weighed down the healthcare sector yesterday with the biotech giant losing 0.63% yesterday, while AMP took the biggest hit on the ASX200 yesterday losing over 6% before entering a trading halt as the Federal Court in Victoria ruled in favour of claimants against AMP in a class action known as the ‘buyer of last resort’ proceedings.
The winning stocks on the ASX200 yesterday were Elders (ASX:ELD) adding 4.8%, Bellevue Gold (ASX:BGL) lifting 4.09% and Seek (ASX:SEK) rising 3.9%. And on the losing end aside from AMP (ASX:AMP), Netwealth Group (ASX:NWL) fell 3.8% and Telix Pharmaceuticals (ASX:TLX) lost 3.4%.
Overseas, China’s latest Caixin manufacturing data released yesterday for June came in at 53.9 points which fell short the forecasted 56.5 points and is a sharp decline from the 57.1 points recorded in May, adding further concerns around China’s overall economic recovery post-pandemic.
What to watch today: