It appears the ASX is unlikely to arrest its downward slide today, with ASX Futures down 0.3% or 21 points overnight to sit at 7,177 before market open this morning.
Global markets fell overnight, with European markets pushed lower by strong inflation data and the looming spectre of more rate hikes.
The 12-month inflation rate rose in France, lifting to 7.2% in February from 7.0% the month before on higher food prices.
Spain followed suit, with consumer prices rising 6.1% in the 12 months to February compared to 5.9% in January.
Healthcare stocks dragged 1.5% lower, but banks lifted 1.4% and momentarily hit their highest level since 2018.
The FTSEurofirst300 slipped 0.4%, but was up 1.6% overall in February, while the UK FTSE 100 fell 0.7% but rose 1.3% over February.
US markets struggle through February
US markets also lost out today but were also unable to make any gains during the month: The Dow fell 232 points or 0.7% at end of trade and 4.2% in February, the S&P500 fell 0.3% today and 2.6% over the month, and the Nasdaq shed 11 points or 0.1% and dipped 1.1% in the last month.
Goldman Sachs (NYSE:GS) contributed to the Dow’s pain, shedding 3.8% off its share price after chief executive David Solomon said the bank was considering "strategic alternatives" for its consumer business.
Debt-loaded Norwegian Cruise Line shares slid 10.2% after reporting greater than expected losses during the quarter, further exacerbated by a large helping of debt made more burdensome by rate hikes.
Norwegian isn’t the only cruise line in peril; while Norwegian owes some US$14 billion, Carnival holds US$35 billion and Royal Caribbean $25 billion.
Target shares gained 1% on upbeat sales from the holiday quarter, and Meta recovered 3.2% after the company announced it was creating a new product group focused on generative artificial intelligence.
Oil prices likely to rise this year
A Reuters survey of 49 economists and analysts has revealed the oil market will likely rise steadily this year, pushed higher by a supply deficit.
With Russia tightening its oil exports and China returning to normal operations following the end of COVID-19 lockdowns, economists forecast the oil price may rise above US$90 a barrel toward the second half of the year.
Predictions:
- Brent crude to average US$89.23 over the year, down from January’s consensus of US$90.49.
- West Texas to average US$89.23 a barrel, slipping from US$85.40 in January
While it’s still too early to predict how the year will turn out, global oil prices did rise 2% overnight, with Brent rising US$1.44 or 1.7% to US$83.89 a barrel, West Texas Intermediate rose US$1.16 or 1.53% to US$76.84 a barrel, and US Nymex increased by US$1.37 or 1.8% to US$77.05 a barrel.
In other news
Major currencies had varied success against the US dollar overnight, with the Australian dollar rising from US67.03 cents to US67.56 cents and finishing near US67.25 cents.
The Japanese yen also gained, strengthening from 136.90 yen per USD to JPY135.77 and closing near JPY136.15.
The Euro, on the other hand, fell, dropping from US$1.0644 to US$1.0574 and meeting US close at about US$1.0575.
Short-term US government bonds fell on Tuesday, driving yields higher in anticipation of further rate hikes from the Fed.
US 10-year treasury yield held steady at 3.93%, but 2-year bond yields rose by 2 points to 4.82%.
On the commodity side, copper futures rose 2.2% on hopes of renewed demand from China, joined by iron ore futures gaining 1 US cent or less than 0.1% to US$125.75 a tonne, while aluminium futures shed 0.2%.
Gold futures rose by US$11.80 or 0.6% to close near US$1,836.70 an ounce, while spot gold was trading close to US$1,827 at US market close.