ASX futures entered the weekend flat, indicating some caution and indecision ahead of the market open, however, US futures have opened strongly this morning, which could lead to a modest start for the ASX. Tech shares have continued to show signs of increased volatility and pull, dragging other sectors with them. In the week ahead, August’s unemployment data will be laid bare, while the US Federal Reserve will also be watched closely for its near and mid-term economic outlook.
Economic calendar and news
RBA minutes from the most-recent meeting will be released on Tuesday morning, alongside house price index data for the second quarter of the year. The following day, August new home sales data will be published.
However, the highest-profile news will be the latest unemployment figures, which will take into account the full impact of the ongoing lockdown in Melbourne that has crippled businesses across the region. Preliminary forecasts from economists suggest that the impact on jobs in Melbourne could offset an improvement in other regions across the country, with the national unemployment rate tipped to increase from 7.5% in July to 7.7% in August, which would make it the highest level in 22 years.
In the US, retail sales will once again come under scrutiny, with the segment showing resilience in recent months amid government stimulus. With August being the first month where such support measures were dialled back, it remains to be seen whether retail sales grow from record-high levels. The Fed Reserve will also hold its final pre-election meeting, with monetary policy and economic outlook commentary, or the lack thereof set to sway broader sentiment. Meanwhile, Chinese retail sales and industrial production figures will detail the strength of two key drivers of the nation’s economy, with data on the latter more likely to influence ASX exporter stocks.
ASX major movers
Tech shares are again likely to be one of the most-watched segments this week, with the sector seeing recent weakness on account of heavy selling in the NASDAQ, which entered a technical correction last week. Stocks like Afterpay (ASX: APT), Xero (ASX: XRO), Computershare (ASX: CPU), NextDC (ASX: NXT), Altium (ASX: ALU) and Appen (ASX: APX) are among those which have seen a sharp pullback in recent weeks, in some cases even before the NASDAQ-induced bout of selling.
After a rough time last week, energy shares may also be on traders’ radars depending on how the oil market fares. With the price of crude oil coming under selling pressure last week, stocks like Oil Search (ASX: OSH) and Santos (ASX: STO) slid, however, some stability or improvement in the price of oil may help arrest negative sentiment.
BHP (ASX: BHP) and Rio Tinto (ASX: RIO) both had a strong run in US trading on Friday evening, which may give them some momentum entering the new week.
For dividend investors, Breville Group (ASX: BRG), Chorus (ASX: CNU) and Hub24 (ASX: HUB) will all trade ex-dividend today, followed by the likes of Costa Group Holdings (ASX: CGC) on Wednesday, and then AMP (ASX: AMP) and Qube Holdings (ASX: QUB) on Friday. Of those stocks, Hub24 enters the trading week circling its all-time high, which was recorded in the last fortnight.
SelfWealth Ltd ACN 52 154 324 428 (“SelfWealth”) (Australian Financial Services Licence Number 421789). The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. Taxation, legal and other matters referred to on this website are of a general nature only and should not be relied upon in place of appropriate professional advice.