ASX200: Company Gross Operating Profits and COVID-19 News to Influence

The ASX200

It was a bearish end to the week for the ASX200 on Friday.

Reversing a 0.11% gain from Thursday, the ASX200 slid by 1.73% to end the day at 7,279.

Upbeat retail sales figures for October failed to provide support, with a flight to safety sinking the index on the day.

News of a new COVID-19 strain and government plans to contain the spread of the more virulent strain led to a broad-based equity market sell-off.

The Stats

In October, retail sales jumped by 4.9% versus a forecasted 2.5% rise, according to prelim figures. Retail sales had risen by 1.3% in September.

According to the ABS,

• Food retailing fell by 0.5%, while household goods retailing increased by 4.5% in the month.
• There were also increases in retailing for:
  • Clothing, footwear, & personal accessories (+27.7%).
  • Department stores (+22.4%).
  • Other retailing (+2.2%).
  • Cafes, restaurants, & takeaway food services (+12.3%).

The Market Movers

It was a bearish day for the banks. Macquarie Group led the way down, sliding by 3.22%, with NAB and Westpac seeing heavy losses of 2.37% and 2.54% respectively. CBA and ANZ ended the day down by 1.00% and by 0.73% respectively.

Commodity stocks also took a hit. Fortescue Metals Group Ltd slid by 3.86% to lead the way down, with Rio Tinto and BHP Group ending the day down by 2.25% and by 1.53% respectively. Newcrest Mining bucked the trend, however, rising by 0.83%.

Other Asian Markets

Elsewhere, it was also a bearish session. The Nikkei and the Hang Seng Index slid by 2.53% and by 2.67% respectively, with the CSI300 falling by 0.74%.

The Day Ahead

It’s another relatively quiet day ahead on the Aussie economic calendar. Company gross operating profit figures for the 3^rd quarter will be in focus later this morning.

While the figures tend to draw plenty of interest, COVID-19 news will remain the key driver on the day. The markets will be looking for updates on the new strain’s resilience against existing vaccines…