Josh Gilbert, market analyst at eToro Group Ltd, shares his three things to watch in Australia in the coming days.
Market moves
Just a week ago, markets were clouded by uncertainty as investors weighed the fallout from rising geopolitical tensions – but true to form in 2025, investors stayed the course. Calm prevailed, and confidence returned, with the S&P 500 and Nasdaq both climbing to fresh record highs and the ASX200 also finishing stronger. So far this year, we've seen US$165 billion flow into US equity funds, putting them on track for their third-largest annual haul in history. It’s a clear sign that investors are still backing equities, even in the face of looming risks.
Markets have some big tests ahead. Q2 earnings season kicks off within the next week, the ASX reporting season is fast approaching, and Trump’s looming tariff deadline within the next 10 days adds another layer of uncertainty. Each of these will serve as key pressure points that could dent sentiment and test this market rally.
While this week is relatively quiet on the earnings front, all eyes will be on vehicle delivery numbers, with Tesla’s highly anticipated second-quarter update set to take centre stage on Wednesday. It’s a pivotal moment for Tesla, shares are down 15% this year, and anything short of a solid delivery update could deepen investor concerns.
Last Friday’s PCE reading likely sets up the Fed to keep rates steady through mid-year; the key for US stocks to keep driving higher will be a reassuring earnings cycle and a strong consumer as we go into the second half of the year. S&P500 earnings are set to grow by 2.8% through Q2, which would mark the slowest growth in two years, a slightly tepid growth forecast that may put record highs and valuations in the spotlight.
AU retail sales
Our last retail sales reading for FY25 lands on Wednesday. Even amid improving conditions this year, it has been a difficult stretch for retailers, with results coming in well below forecasts over the last few months.
Markets are predicting a 0.3% improvement in June and with CPI recording a drop last week, promising employment figures and a rate cut on the cards for July, the Aussie economy is looking healthier by the month. Sales figures for the EOFY period will likely reflect that.
US Jobs
Last week’s US weekly jobless claims report indicated that benefit claims were falling but work opportunities overall were drying up, setting the stage for a bump in unemployment on Thursday, US time. For the past year, the US unemployment rate has floated steadily between the 4.0% to 4.2% mark. June’s figures are expected to notch that rate up to a 12-month high of 4.3%. Obviously this is not a particularly alarming jump, but this ripple on the surface could forecast greater concerns.
It’s no secret that under Trump’s presidency, volatility has been swiftly introduced into the US economy, and his ‘USA made’ election focus is yet to manifest as something measurable. In fact, even Trump Mobile’s recently announced gold smartphone has quietly removed its ‘made in the USA’ pledge that it launched with.
According to a report released last week by AP, the unemployment rate is even higher among college degree holders aged between 22 to 27, hitting a 13-year high of 5.8% in March. Factoring in the rapid advancement of AI disruption, and it’s a concerning outlook for the broader US economy. Trump will have plenty of work ahead of him to turn this around if the trend continues.