Global markets were lower overnight, as US markets (S&P 500 Index -0.4%) slipped after failed peace talks between Ukraine and Russia spooked investors once again, and the European Central Bank (ECB) kept its interest rate hike plans in place, despite the current conflict.
US CPI (inflation) data came in hot just as expected, rising +7.9% year on year (compared to +7.5% annual rise in January), and up +0.8% month on month – hitting a fresh 40-year high. The Fed is expected to kick off its tightening cycle next week with a 0.25% rate hike.
Technology, consumer staples, and financials led the market lower, while energy stocks got a leg up as the conflict continues to mount.
Amazon bucked the trend as its shares jumped +5.4% after the board approved a 20-for-1 stock split and US$10 billion share buyback.
European Markets were down (Stoxx 600, -1.8%) overnight as investors digested the latest ECB meeting. The European Central Bank opted to keep interest rates steady, remaining cautious as it assesses the economic fallout from Russia’s invasion of Ukraine. But it announced that it will wind down asset purchases faster than planned, before adding that it stands ready to revisit this decision if the outlook changes. Lagarde said QE bond purchases could then end in the 3rd quarter, subject to the economic outlook. Rate hikes would happen only “some time” after bond purchases had stopped but, repeatedly pressed by journalists to clarify what this meant, Lagarde said it could be anything from a week to some months later. Some analysts think the ECB could stop QE at the end of June which would potentially open the door to a 25bps rate hike as soon as the July meeting, something markets now see as around a 30% chance. The ECB’s actions suggest it is more concerned about keeping a lid on inflation and inflation expectations.
Myer (MYR:ASX)

Myer shares surged 24.4% yesterday after delivering a strong half year result and paid out tis first dividend since 2017. Over the half total sales rose +8.5% to $1,517.4m, helped by Online sales which grew +47.5% to $424.1m, now representing 27.9% of total sales. Net profit after tax rose up 55.2% to $32.3 million (excluding JobKeeper).
Myer also advised that during the first five trading weeks of the second half, it has seen a strong return to growth in stores and online. Myer sales are up 15.2%, with store sales up 9.3% and online up 48.6%. We are HOLD rate on Myer.
Australia & New Zealand Market Movers
The Australian market was up yesterday (ASX200 index +1.1%) as easing oil prices calmed market nerves.
Most sectors traded higher, technology, consumer discretionary, and financials leading gains as investors risk appetite improved. Most sectors were up except for energy and materials as commodity prices pulled back. Rio Tinto suffered a heavy loss down -7.7% as it traded ex dividend.
Travel stocks performed strongly (as a benefactor to falling oil prices) Qantas rising +5.8%, Flight Centre up +6.6%, and Corporate Travel management rose +5.5%.
The New Zealand market was up on Thursday (NZX 50 index, ]] +1.2%) following a strong global recovery as oil prices retreated – with gains across the market.
Stocks that had been heavily beaten down recently heavily started to make ground, Pacific Edge up +6.9% and Serko gaining +4.7%.
Easing oil prices saw Air NZ bounce back rising +4.4%, while Auckland International Airport was also up strongly as well climbing +3.5%.
3 Things Markets will be Watching this Week
- Geopolitical risks remain extremely elevated with the Russia/Ukraine conflict.
- Highlights this week include the latest US inflation (CPI) print.
- The European Central Bank (ECB) meeting and trade data from China will be closely watched.