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ASX this week: US election impacts and Chinese data

ASX this week: US election impacts and Chinese data

Investors are likely to see volatility in financial markets over the coming months, as the world tries to understand what Donald Trump's victory in the US presidential election means for global economies and businesses.

Australian stocks had a roller-coaster ride last week, with the S&P/ASX 200 index tumbling to as low as 5,052.1 on Wednesday as a Trump presidency emerged, but rebounded to 5,370.7 at the end of Friday.

Over five days, the benchmark stock gauge rallied 3.7%, halting four consecutive weeks of losses. It was also the ASX 200's biggest weekly gain since the week ended 15 July 2016.

On Friday:

  • Brent oil slipped 2.4% to US$44.75 a barrel; down 1.8% for the week
  • WTI crude shed 2.8% to US$43.41 a barrel; down 1.5% for the week
  • Iron ore with 62% content delivered to Qingdao, China, surged 7.7% to US$79.81 a dry metric tonne, extending its weekly increase to 22.8%
  • Spot gold fell 2.5% to US$1,227.64 an ounce; down 5.9% for the week
  • Australian dollar traded at 75.46 US cents, weakening 1.7% over the week; the currency dropped 0.2% to 75.33 US cents at 11:50am Sydney time today

What to watch this week

As the dust from the US election settles, financial markets are shifting to growth stocks from income-focused ones, according to CommSec.

Those that gained post-election included banks, industrial and defence stocks, while retailers and technology companies were lower, CommSec said.

"Expect volatility over the next two to three months," it added.

Australia's largest trading partner, China, is releasing monthly data on retail sales, production and investment.

"Annual growth rates have seemingly found a base and are showing encouraging signs of lifting," CommSec said. "A strong Chinese economy has been a key driver of the recent lift in commodity prices and the rebound in resource stocks over the last few months."

Prices of iron ore are in focus as well, after ore with 62% content delivered to Qingdao, China, soared 23% last week.

Other key economic data to watch is Australia's employment report for October, to be published on Thursday. CommSec expects the nation's jobless rate to stay at 5.6% and job growth of about 20,000 in the month.

Stock movers

Below are the five best- and worst-performing ASX 200 stocks for the week ended Friday, November 11.

Company/Index

ASX code

Weekly price change

Western Areas

WSA

+33.3%

Sims Metal Management

SGM

+23.9%

Independence Group

IGO

+19.7%

Fortescue Metals Group

FMG

+18.7%

BlueScope Steel

BSL

+17.7%

S&P/ASX 200

XJO

+3.7%

Virtus Health

VRT

-9.2%

Saracen Mineral Holdings

SAR

-9.5%

St Barbara

SBM

-9.6%

Regis Resources

RRL

-12.9%

Resolute Mining

RSG

-14.4%

Past performance is not a reliable indicator of future performance. Source: Bloomberg

This article is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. The inclusion of companies in this article does not constitute a recommendation and it’s vital to remember that the value of shares in any company can fall as well as rise, which means you could lose money by investing in them. Investors should consult a range of resources, and if necessary, seek professional advice, before making investment decisions in regard to their objectives, financial and taxation situations and needs because these have not been taken into account. Any securities or prices used in the examples given are for illustrative purposes only and should not be considered as a recommendation to buy, sell or hold. Past performance is not indicative of future performance. Commonwealth Securities Limited ABN 60 067 254 399 AFSL 238814 (CommSec) is a wholly owned but non-guaranteed subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945 and a Participant of the ASX Group and Chi-X Australia.