ASX remains under pressure as Wall Street books its longest stretch of weekly losses since 2011

May 9, 2022 - 3 weeks ago
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The Australian sharemarket is seen for further losses into the start of a new week as U.S. stocks on Wall Street wrap up another volatile week with more losses, booking its fifth straight weekly decline and its longest stretch of weekly losses since 2011.

The ASX futures lost -51 points or -0.7% to 7,107, while our local currency, the Australian Dollar, is currently buying US$0.7022 (as of writing).

Friday’s pullback came as investors balanced a strong U.S. jobs report against worries the U.S. Federal Reserve may cause a recession in its drive to halt inflation.

The U.S. economy added 428,000 jobs in April, above market forecasts, and the unemployment rate remained unchanged at 3.6%, the U.S. Department of Labour announced on Friday.

At the finishing bell, on the New York Stock Exchange (NYSE), the blue-chip Dow Jones Industrial Average dropped -98.60 points, or -0.3%, to 32,899.377, after plunging slumping more than -1,000 points Thursday, its worst day since 2020.

The broad-based Standard & Poor’s 500 Index lost –23.53 points, or -0.6%, to 4,123.34, capping a fifth consecutive week of losses, the longest streak since June 2011, while the rich-tech Nasdaq Composite Index fell by -173.03 points, or -1.4%, to 12,144.66.

The US dollar index (US DXY), which tracks the greenback against a basket of its peers, rallied to $104.06 on Friday, its highest level in almost 20 years.

Precious metals rose, with spot gold adding +0.28% to $1,878.80 an ounce, and silver gained by +0.30% to $22.28.

Global benchmark Brent crude was trading at $112.96 a barrel, up +1.80%, while U.S. benchmark West Texas Intermediate (WTI) crude was at $109.78– a +1.9% gain.

Meanwhile, cryptocurrencies Bitcoin, the world’s largest cryptocurrency by market value, plunged by -8% and is trading at US$33,700.00 (as of writing).

Based on the daily technical assessment of the S&P/ASX 200 (XJO), a weaker opening is foreseen, with the intraday support located at 7,080 minor, with 7,035 viewed beneath. Reassess from there.

Assessing the topside, the resistance is seen at 7,125 minor, with 7,160 located above. Reassess from there.

Daily outlook on the benchmark S&P/ASX 200

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