News – AU – ASX loses profits after Reserve Bank stays in place

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Police have determined that human remains found on a beach on the south coast of NSW do not belong to Sydney-born Melissa Caddick

The Australian stock market has pulled back as the Reserve Bank failed to provide any fresh impetus to the improving Australian economy despite the chaos in bond markets that has driven interest rates high

Until 14At 50 p.m. AEDT, the All Ordinaries Index had a fifth percent, or 12 points, to 7031 lost, with more sectors going into the red

The index had gained 1 percent in early trading, hoping for another sugar blow from the RBA and after strong gains on Wall Street on optimism about the latest coronavirus vaccine

The ASX 200 index also lost its gains, falling 5 points or less than 01 percent at 6787

Education companies, oil stocks, miners, industrial companies, utilities and real estate companies all fell while consumer companies, banks, technology stocks and healthcare companies maintained the higher position

A2 milk (71 pieces) was higher, as was media company Nine Entertainment (61pc) and metal recycler Sims Metal Management (54pc)

On the ASX 200, gold miners Gold Road Resources (-7) fell below 2), Westgold Resources (-58pc) and Northern Star (-39pc) as the price of the precious metal weakened

Biotech company Mesoblast fell 53 to $ 233 after raising $ 110 million at a discount by issuing new shares to US investors

On the business news today, the Reserve Bank met and kept the nation’s official interest rates close to zero at 01 percent

Interest rates in bond markets are rising as investors fear inflation will pick up again as the post-COVID recovery picks up pace and tech stocks are hit particularly hard

This was in line with the predictions of all but one of the 15 economists surveyed by Refinitiv

In his post-meeting statement, RBA Governor Dr Philip Lowe, Australia’s economic recovery is “in full swing” and stronger than previously expected

Dr Lowe noted that rising bond yields around the world had raised the Australian dollar, but reiterated that the central bank would not raise official interest rates until inflation rises above 2 percent

“The positive news about vaccines and the prospect of further significant fiscal stimulus in the US have resulted in longer-term bond yields rising significantly over the past month”

Analysts at investment bank UBS had predicted that the RBA would take a more radical step and step up its quantitative easing (QE) program – colloquially known as digital “money printing” – and even buy 20-year government bonds

“We believe the bank can add to its existing $ 200 billion QE envelope (effectively accelerating weekly buybacks from the current $ 5 billion per week),” UBS wrote -Strategist Giulia Specchia in a note

The Australian dollar fell to a daily low of 77. Immediately after the RBA’s announcement, 37 US cents quickly hit their lost bottom again at around 776 US cents

In the USA, the controversial Resolution Copper project by Rio Tinto and BHP in Arizona is facing another hurdle The U.S. Department of Agriculture ordered the U.S. Forest Service to withdraw the final environmental impact statement that paved the way for a land transfer to the great miners in the final days of the Trump administration

Rio Tinto and BHP face a new fight for the rights of the indigenous rural population, this time for their planned copper mine on Apache land in the USA

Mine development on sacred Apache land is being rejected by traditional owners, including the San Carlos Apache who filed a 911 call

US attorney Luke Goodrich of the Becket Fund, who represents Apache Stronghold, a grassroots group fighting the mine, said the move was just temporary reparation for the Oak Flat site

“The government knows that the demolition of Oak Flat is against federal law, including the Law to Restore Religious Freedom, and is therefore withdrawing temporarily,” he said

Spot gold slipped 0.5 percent to 1$ 714 an ounce while oil was also sold, with Brent crude falling 12 percent to $ 6293 ahead of an OPEC meeting later this week

The Bureau of Statistics announced that building permits for new houses fell sharply in January

Jo Masters, EY chief economist, said the numbers reflected the reduction in the federal government’s HomeBuilder construction grant

“This is perhaps the first indication of the temporary nature of the recent surge in building permits as the first, higher-paying phase of the federal government’s HomeBuilder program came to an end”

“In the near future, the surge in HomeBuilder applications in late 2020, as well as the extension of the program through March, will support home permits”

“However, once the program is complete, we should expect a significant drop in permits as weak population growth and high vacancy rates in Australia’s major cities weigh on demand for new homes,” Ms. Masters said

Chief Economist at BIS Oxford Economics Sarah Hunter said ABS balance of payments data showed net exports could put a 0. December quarter GDP growth will be weighed 1 percent

The current account surplus rose to USD 145 billion thanks to booming commodity prices and a recovery in agricultural exports thanks to an interruption in the drought

“Without a strong rebound in goods imports, the surplus would have hit record highs,” she said

“The replenishment by retailers after the strong sales in goods retailing by 2020 led to a 1 percent increase in the volume of consumer goods imports”

Capital Economics announced it had raised its estimate for the quarter from 2.3 percent to 27 percent growth “given solid public investment and net trade data”

On Wall Street, the S&P 500 posted its largest one-day gain since June as bond markets calmed down after a month-long sell-off

In general, it might not be a printing press, but the RBA has been busy creating billions of dollars out of nowhere, David Taylor explains how to do it

The industrially distorted Dow Jones rose 603 points (2 percentage points) to 31536 points, while the tech-heavy Nasdaq Composite (3 percentage points) rose to 13589 points gained

“We got a pretty good rebound from sales late last week,” said Rick Meckler, partner at Cherry Lane Investments in New Jersey

“Investors have started focusing again on the idea that the pandemic may be coming to an end”

The eagerly anticipated US dollar1 also boosted the market with 9 trillion coronavirus relief bills that were approved by the US House of Representatives on Saturday and are now moving into the Senate

It was a tough day for European markets too Britain’s FTSE, Germany’s DAX and France’s CAC 40 all closed 16 percent higher

Major government bonds rallied on Monday as markets showed further signs of stabilization after their worst monthly performance in years

Central banks around the world have tried to keep interest rates at record lows, but some traders had other ideas

Expectations of economic recovery and rising inflation pushed global benchmark bond yields to the largest monthly increase in years in February

The yield on the American benchmark bond, the 10-year Treasury bill, traded at 4376 percent, down from 1456 percent on Monday

Sebastien Galy, senior macro strategist at Nordea Asset Management, noted that the U.S. Treasury Department’s return is below the year-long high of over 1.60 percent touched last week, despite the refusal by the U.S. Federal Reserve and others like the European Central Bank to intervene and limit rising returns

“This is most likely the end of that tantrum and offers opportunity for investors faced with changing markets,” he said

We recognize the Aboriginal people and the Torres Strait Islander as the first Australians and traditional administrators of the countries where we live, learn and work

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Reserve Bank of Australia, Australian Dollar, Central Bank, Bonds

News – AU – ASX loses profits after Reserve Bank stays in place
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Source: https://www.abc.net.au/news/2021-03-02/asx-stockmarket-wall-street-reserve-bank-rba/13205570