On the global and US stock markets overnight, both US and European markets reached records, powered by signs that stimulus cheques are feeding into the real economy and suggesting the recovery may still have legs.
The S&P/ASX 200 (ASX: XJO) and All Ordinaries (ASX: XAO) are both expected to open higher on Friday. See Rask Media’s daily ASX 200 morning report.
The Dow Jones Index (DJI) finished 0.9% higher, the S&P500 (INX) 1.1% and the Nasdaq 100 1.3%, with the healthcare, technology and real estate sectors the strongest.
US stock report:
- Tesla Inc (NASDAQ: TSLA) – up 0.9%
- Apple Inc (NASDAQ: AAPL) – up 1.9%
- Berkshire Hathaway Inc (NYSE: BRK) – up 0.6%
- Facebook Inc (NASDAQ: FB) – up 1.6%
- Amazon.com Inc (NASDAQ: AMZN) – up 1.4%
It appears the US$1,400 stimulus cheques didn’t stay in savings accounts for long, with retail sales jumping 9.8% in March, a record beaten only by the growth last May.
Bars and restaurants were the standouts with sales jumping 13.4% and clothing 18.0% for the month alone.
In speaking with a number of fund managers this week the strength of this consumer recovery is not yet fully appreciated by the market, representing 70% of the economy there may well be some surprises to come. World-beating Taiwan Semi-Conductor Manufacturing Co (TPE:2230) stock jumped 1.1% after reporting a 19% increase in first-quarter profit.
As a key holding in the Platinum Investment Management (ASX: PTM) and Munro Partners strategies, Taiwan Semi-Conductor has benefitted from a huge boost in the demand for high power processing chips.
The company’s profit was supported by a 17% revenue increase, as gaming console and electronic demand led to a shortage; North American revenue continues to take up 2/3rds of the company’s sales.