Markets bounce back from inflation led sell off

Tech stocks led the market back into positive territory after the previous sessions inflation led sell off after the March PPI number came in below estimates providing a positive data point for inflation concerns.

The S&P 500 closed up 0.74 per cent with the tech heavy Nasdaq the best performing index rising 1.68 per cent to a new record level. The Dow Jones underperformed closing down 2.43 points.

The big tech names rallied strongly over the day with Nvidia jumping 4.1 per cent, Amazon up 1.7 per cent and Alphabet closing more than 2 per cent higher. Apple surged 4.3 per cent on reports the company will be transitioning its Mac product line to AI chips.

Investors will now turn their attention to reporting season with the big investment banks, Citigroup, Wells Fargo & JP Morgan kicking off the corporate earnings season on Friday. One of the early reporters was CarMax which fell more than 9 per cent after disappointing on both top and bottom lines.

New York Fed President John Williams said during an event Thursday that there is no need for a policy change in the near term. Treasury 10-year yields rose two basis points to 4.57 per cent. The euro dropped after the European Central Bank gave its clearest signal yet that it will probably cut rates in June after holding them steady overnight, with president Christine Lagarde stressing that the nature of inflation in Europe was different from the US.

The US sectors were mixed overnight. Tech was unsurprisingly the best performer, after the big tech stocks rallied. Financials was the worst performer.

In the Australian landscape, today’s agenda includes a range of key economic data releases and earnings reports.

Domestically, the ABS will publish data on the 2022-23 apparent consumption of selected foodstuffs at 11:30 am.

Overseas, notable releases include manufacturing data from New Zealand at 8:30 am, Japan's industrial production at 2:30 pm, and the UK's GDP figures at 4 pm. Additionally, investors will be watching for Eurozone CPI at 4 pm, US import prices at 10:30 pm, and US consumer sentiment data at 12 am.

Futures

The SPI futures are pointing to a 0.4 per cent fall.

Currency

One Australian dollar at 7.25am was buying 65.38 US cents.

Commodities

Gold gained 1.03 per cent. Silver added 0.71 per cent. Copper fell 0.68 per cent. Oil lost 1.38 per cent.

Figures around the globe

European markets closed lower. London’s FTSE fell 0.47 per cent, Frankfurt lost 0.79 per cent, and Paris closed 0.27 per cent lower.

Turning to Asian markets, Tokyo’s Nikkei fell 0.35 per cent, Hong Kong’s Hang Seng lost 0.26 per cent and China’s Shanghai Composite closed 0.23 per cent higher.

Yesterday, the Australian share market closed 0.44 per cent lower at 7,813.58.

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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