China’s sluggish GDP weighs on the ASX

The truth : The ASX 200 recovered from a nine-day low in early trading, but that wasn’t enough to head off a three-day winning streak.

Miners dragged the market lower as iron ore slid on fears of a slowdown in demand in China, which reported sluggish GDP growth of 0.4% on Friday. Iron ore futures were down 4.8% to settle at US$104.96.

In its second-quarter production report, Rio Tinto said rising inflation slashed $400 million from its underlying pretax profit for the first half of 2022.

“Trade disruptions, food protectionism and a focus on securing energy supplies continue to put pressure on supply chains, which will need to be loosened significantly before inflationary pressures ease,” said the miner.

Financials closed 0.6% lower as the big four banks closed relatively flat ANZ, down 1.32% to $21.64 after confirming it was in talks to acquire MYOB plus early in the week.

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After Thursday’s historic low unemployment rates and decades-high inflation in the United States, Commonwealth Bank’s Australian head of economy Gareth Aird revised the bank’s estimate of a rate of cash from 2.1% by the end of the year to 2.6%.

“We have revised our central scenario for the RBA based on the latest labor force data, a further modest upward adjustment to our near-term inflation forecast and our expectation that the RBA will continue to move forward. ‘a number of other global central banks by aggressively raising the policy rate over the coming months,’ Aird said.

Aird expects back-to-back rate hikes of 50 basis points in August and September, followed by a 25 basis point hike in November.

Tweet of the day:

Quote of the day: “We have this generation of people who grew up in the GFC seeing the financial struggles of their parents, and they just don’t trust our financial system. They see all the freshness, all the opacity, so they’re building something different,” said Lisa Wade, CEO of DigitalX. “Just like when the Internet was born, nothing can stop this. Bitcoin is the child currency of this movement and of the younger generation who don’t want to use our money.

You may have missed: Booktopia founder and former chief executive Tony Nash was ousted by the online bookseller’s board following a sharp drop in market value and share price over the past year . Shares of the company, which once traded at a high of $3 in August last year, gained 3.2% on Friday to 32¢.

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