The Monday Report – 17 March 2025

This story features AUSTIN ENGINEERING LIMITED, and other companies. For more info SHARE ANALYSIS: ANG

The best day for US markets in 2025 has SPI futures pointing to a strong opening ahead.

Good morning.

Markets briefed a sigh of relief 

US markets rallied as the Democrats chose not to block a Republican funding bill and on rumours of Chinese stimulus aimed at boosting domestic consumption. A lack of tariff news also supported risk sentiment, benefiting sold-off stocks and cryptocurrencies.

Major indices posted strong gains, with the Nasdaq up 2.61%, the S&P 500 rising 2.13%, and the Dow Jones gaining 1.66%, following a rally in Chinese shares. The CSI300 climbed 2.4%, and the Hang Seng gained 2.1%.

Despite the rebound, all three major US indices ended the week lower, with the Dow down -3.1%, marking its worst week since March 2023. The S&P500 and Nasdaq both declined over -2%, extending their losing streak to four consecutive weeks.

US consumer sentiment, measured by the University of Michigan, fell to 57.9, well below the expected 63, marking a third consecutive monthly decline. Long-term inflation expectations rose to 3.9%, the highest level since February 1993, compared to a 3.4% forecast.

Big-box retailers, including Walmart, are negotiating price reductions from Chinese manufacturers to offset tariffs, while some manufacturers are shifting production to other parts of Asia.

European markets maintained upward momentum, with the Eurostoxx 50 rising 1.4%. In Germany, political parties reached an agreement to increase fiscal spending.

Tony Sycamore, IG, states:

“Markets face another eventful week ahead. Key focus areas include Monday’s US retail sales data and Thursday’s FOMC meeting. The Retail Control Group is expected to rise 0.3% in February after a 0.8% decline in January. A negative print would reinforce concerns over a stalling US economy. The Fed is anticipated to keep rates unchanged at 4.25-4.50%, with projections indicating only two more -25bp cuts in 2025. Markets currently price in a -25bp Fed rate cut in June and -69bp of cumulative cuts this year.

A strong US jobs report this week would likely lead the RBA to hold rates in April, waiting for softer Q4 inflation and labour market data before considering a cut in May. Current expectations suggest Australia will add 20,000 jobs in February, with unemployment steady at 4.1%. The Australian interest rate market prices in 18bp of RBA rate cuts for May and 62bp in total for 2025.”

In other news, the Financial Times’ Swamp Notes podcast discusses the continued decline of the US dollar amid market volatility over President Donald Trump’s tariff policy. Some within Trump’s economic team are reportedly considering intentional dollar weakening. FT economics columnist Gillian Tett and Unhedged host Katie Martin explore whether market chaos is an intended strategy rather than a side effect. The podcast is available on Spotify.

On the calendar today:

-CH Feb Retail sales

-CH Feb Unemployment

-US Feb retail sales

-AUSTIN ENGINEERING LIMITED ((ANG)) ex-div 0.60c (100%)

-HUB24 LIMITED ((HUB)) ex-div 24c (100%)

-NEW HOPE CORPORATION LIMITED ((NHC)) earnings report

-RAMELIUS RESOURCES LIMITED ((RMS)) ex-div 3c (100%)

-SKS TECHNOLOGIES GROUP LIMITED ((SKS)) ex-div 1c (100%)

-SAUNDERS INTERNATIONAL LIMITED ((SND)) ex-div 2c (100%)

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

Corporate news in Australia:

-Ramelius Resources ((RMS)) and Spartan Resources ((SPR)) are reported to be approaching a low-premium $4bn merger due to the surge in Spartan’s share price

-CEO of Regal Partners ((RPL)), Brendan O’Connor, sold around -10% of his holding, worth $3.4m, to cover a tax bill and building works

-Smartpay Holdings ((SMP)) has reportedly received two non-binding indicative offers after its shares fell due to the RBA’s surcharge review impact and is in talks with Tyro Payments ((TYR)) to be acquired at NZ$1 per share

-M&A activity in the gas sector has been highlighted by ConocoPhillips

-Optus is reviewing the possibility of bundling mobile plans with subscriptions to sports matches to win back customers following a data breach and network outage

-Barclays chief operating officer Paul O’Malley will join the board of Commonwealth Bank ((CBA)) on March 31

-National Australia Bank ((NAB)) chief financial officer Nathan Goonan has resigned and will join Westpac ((WBC))

The Australian share market over the past thirty days

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

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