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ASX closes 0.6% lower over Euro COVID fears

Daily Market Update (75)

ASX follows global markets lower, AMP retains property, travel stocks hit
 
The S&P/ASX200 (ASX: XJO) succumbed to the global weakening of sentiment, falling 0.6 per cent on Monday with both energy and consumer businesses the major drag.
 
The energy sector continues to fall as oil prices weaken, falling 1.6 per cent, despite surging gas prices now impacting on the East Coast of Australia.
 
But by far the hardest hit today were travel-related companies, with the consumer sector falling 0.6 per cent but the likes of Flight Centre (ASX: FLT) and Corporate Travel (ASX: CTM) down over 7 and 6 per cent respectively.
 
The driving force was a surge in cases of COVID-19 across Europe and the US and in both highly vaccinated and unvaccinated cities; shares hit a two-month low on the news.
 
Shares in the Commonwealth Bank (ASX: CBA) fell another 2.1 per cent, with their economist team now predicting another strong year of growth in property prices in 2022, of around 7 per cent, following by an ‘orderly’ correction in 2022, as the Reserve Bank begins hiking rates.
 
AMP to control office fund, lithium stocks surge
 
Shares in AMP (ASX: AMP) surged another 2.6 per cent to open the week after an independent committee suggested AMP Capital remains the most suited manage of their leading unlisted office fund.
 
The $7 billion strategy had received takeover proposals from Mirvac and GPT, but ultimately it will remain with the jewel of AMP which is set to be transferred into a separate entity in the coming year.
 
Green energy stocks have surged once again, with the materials sector outperforming the market by gaining 0.4 per cent.
 
The gains were widespread with Nickel Mines (ASX: NIC) adding 8 per cent, Pilbara Minerals (ASX: PLS) 5.1 and Orocobre (ASX: ORE) 4.7 per cent respectively.
 
Shares in Nickel were beneficiaries of an announcement of a further expansion in their Indonesian assets with Chinese firm Shanghai Decent Investments, which will see the company partner on optimising their transition to renewable energy sources across their production assets.
 
Powell retains Fed chair, Disney falls on subscribers, banks rally
 
US and global markets were buoyed by news that President Biden had continued with the status quo, nominating Jerome Powell for a second term as Fed Chair.
 
The decision stood out as one of the major risks to the delicately poised domestic economy and ensures stability is retained as the central bank seeks to exit their accommodative policies in the coming years.
 
The Dow Jones surged 0.7 per cent on the news with investors suggesting it will be positive for the banking sector and may trigger a number of acquisitions.
 
The likes of JP Morgan (NYSE: JPM), Goldman Sachs (NYSE: GS), Bank of America (NYSE: BAC) and Wells Fargo (ASX: WFC) all gained at least 2 per cent.
 
The S&P500 was also 0.5 per cent higher with the Nasdaq falling 0.3 per cent after bond yields increased.
 
The Chinese market also rallied after commentary around policy easing by the People’s Bank of China was lightened, suggesting that credit growth may return.
 
Disney (NYSE: DIS) shares continued their difficult recent run with a lack of new production content halting the growth in subscribers, but management remains confident of their 260 million target by 2024.

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