ASX 200 Weekly Wrap: Inflation fears hold ASX down

Here on our ASX 200 Foolish Weekly Wrap, we look at the things that moved the S&P/ASX 200 Index and the broader share market last week!

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Falling ASX share price represented by shocked Investor looking at phone

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The S&P/ASX 200 Index (ASX: XJO) broke a three-week winning streak last week to finish in the red. The week was defined by volatility in the ASX tech sector, together with sinking resources shares.

The tussle between the bond market and both the Reserve Bank of Australia (RBA) and the United States Federal Reserve continues to give off fireworks. Last week, the RBA once again indicated that rates will continue to be held at record lows until 2024 at the earliest. Any rises, the RBA stated, would be completely contingent on both a decisive and sustained rise in inflation and a move towards ‘full employment’.

Over in the US, the chair of the Federal Reserve, Jerome Powell, made a similar commitment. Bond investors didn’t listen though. Investors are continuing to price in rate hikes coupled with future inflation.

As a result, rising bond yields continued to play havoc with the ASX, specifically high-growth shares in the tech sector. Shares like Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: XRO) remained extremely volatile following a big sell off in US tech shares over the week.

Volatility continues

Meanwhile, ASX resources shares also had a clanger following weakness in commodity prices. Iron ore slipped a few dollars per tonne over the week. But it was crude oil that saw the largest readjustment.

On last week’s weekly wrap, you might remember that Brent crude was going for US$69.22 per barrel. At the time of writing, that same barrel is trading for US$64.33. That’s a pretty big move in just one week.

Predictably, this move saw a bit of a readjustment for resources shares. Woodside Petroleum Limited (ASX: WPL) saw a near-4% slide over the week, while the share price of BHP Group Ltd (ASX: BHP), which also has a large oil portfolio, was hit 6.4%.

ASX banks also had a pretty lacklustre week, with Commonwealth Bank of Australia (ASX: CBA) shares falling more than 2%.

How did the markets end the week?

One thing that can be said about the week is that it had a nice pattern. Monday and Tuesday both saw gains for the ASX 200, 0.09% and 0.8% respectively. Wednesday, Thursday and Friday all saw losses of 0.47%, 0.73% and 0.56% each. This meant the ASX 200 started the week at 6,766.8 points and finished up at 6,708.2 points for an overall loss of 0.87% for the week.

Meanwhile, the All Ordinaries Index (ASX: XAO) started out at 7,014.6 points and closed up at 6,959.6 points, a loss of 0.78%.

Which ASX 200 shares were the biggest winners and losers?

It’s that time of the wrap where we get a little saucier by looking at the winners and losers for the week. As always, let’s start with a salacious look at the losers:

ASX 200 Losers

Worst ASX 200 losers % loss for the week
Austral Limited (ASX: ASB) (7.8%)
Nufarm Ltd (ASX: NUF) (6.8%)
Rio Tinto Limited (ASX: RIO) (6.5%)
Perenti Global Ltd (ASX: PRN) (5.8%)

Ship construction company Austal took out last week’s ASX 200 wooden spoon. That was despite no major news out of the company that might cause investors to panic. Austal did, however, go ex-dividend last week, which is the best kind of share price drop an investor can hope for. Austal has a trailing dividend yield of 3.98% on recent pricing, so it’s understandable the exclusion of this dividend would dent the Austal share price.

Next up was chemical manufacturer Nufarm. Nufarm shed a hefty 6.8% over the week, despite no major news out of this company either (or dividend for that matter).

We’ve already talked about the woes faced by ASX resources shares last week and the iron-heavy Rio seemed to cop the brunt of investors’ fears, sliding 6.5%. Rio shares are now down close to 15% over the month of March so far.

Engineering company Perenti was lucky last. Like Austal, we can probably put most of Perenti shares’ fall down to the company trading ex-dividend last week. This company has a trailing dividend yield of 6.64% on recent pricing, so a big fall from an ex-dividend date is to be expected.

Now with the losers out of the way, let’s check out last week’s ASX 200 winners:

ASX 200 Winners

Best ASX 200 gainers % gain for the week
Collins Foods Ltd (ASX: CKF) 19.1%
Clinuvel Pharmaceuticals Limited (ASX: CUV)
Harvey Norman Holdings Limited (ASX: HVN) 9.7%
Link Administration Holdings Ltd (ASX: LNK) 9.3%

Last week’s biggest winner was the Colonel himself! Or more specifically the company which has the rights to the Kentucky Fried Chicken name in Australia. Collins Foods rocketed nearly 20%, despite no major news out of the company. A move like this can sometimes be attributed to a large institutional buyer picking up a big tranche of shares.

Next up was pharma company Clinuvel, which also rose despite no major news or announcements. Clinuvel shares are now up close to 25% year to date.

Harvey Norman was another company that had a top week despite no obvious catalyst. Again, this company is up just a tad over 25% for the year so far, so perhaps investors are betting that the COVID-induced sales bump this company enjoyed last year will continue into 2021.

Finally, we had Link Administration with a 9.3% bump, again despite an absence of major news. My Fool colleague Tristan Harrison recently discussed how Link is proving a popular stock with the fundies at Wilson Asset Management, so perhaps this is behind the company’s moves last week.

A wrap of the ASX 200 blue-chip shares

Before we go, here is a look at the major ASX 200 blue-chip shares as we start another week all over again on the share market:

ASX 200 company Trailing P/E ratio Last share price 52-week high 52-week low
CSL Limited (ASX: CSL) 33.7 $253.95 $332.68 $242
Commonwealth Bank of Australia (ASX: CBA) 18.84 $84.71 $89.20 $53.44
Westpac Banking Corp (ASX: WBC) 38.48 $24.52 $25.30 $13.47
Australia and New Zealand Banking Group Ltd (ASX: ANZ) 23.31 $28.23 $29.55 $14.10
National Australia Bank Ltd (ASX: NAB) 23.89 $25.93 $27.10 $13.20
Fortescue Metals Group Limited (ASX: FMG) 7.52 $20.01 $26.40 $9.21
Woolworths Group Ltd (ASX: WOW) 34.72 $38.90 $42.05 $33.82
Wesfarmers Ltd (ASX: WES) 30.52 $50.61 $56.40 $29.75
BHP Group Ltd (ASX: BHP) 25.31 $44.90 $50.93 $25.69
Rio Tinto Limited (ASX: RIO) 14.08 $109.06 $130.30 $76.20
Coles Group Ltd (ASX: COL) 19.7 $15.49 $19.26 $14.95
Telstra Corporation Ltd (ASX: TLS) 21.54 $3.21 $3.54 $2.66
Transurban Group (ASX: TCL) $12.56 $15.64 $9.10
Sydney Airport Holdings Pty Ltd (ASX: SYD) $6.09 $7.49 $4.26
Newcrest Mining Ltd (ASX: NCM) 15.64 $24.20 $38.15 $21.06
Woodside Petroleum Limited (ASX: WPL) $24.11 $27.60 $14.93
Macquarie Group Ltd (ASX: MQG) 22.48 $148.80 $153.50 $70.45
Afterpay Ltd (ASX: APT) $108.30 $160.05 $8.01

And finally, here is the lay of the land for some leading market indicators:

  • S&P/ASX 200 Index (XJO) at 6,708.2 points.
  • All Ordinaries Index (XAO) at 6,959.6 points.
  • Dow Jones Industrial Average Index (DJX: .DJI) at 32,628.97 points after falling 0.71% on Friday night (our time).
  • Bitcoin (CRYPTO: BTC) going for US$56,963 per coin.
  • Gold (spot) swapping hands for US$1,745 per troy ounce.
  • Iron ore asking US$165.58 per tonne.
  • Crude oil (Brent) trading at US$64.53per barrel.
  • Australian dollar buying 77.38 US cents.
  • 10-year Australian Government bonds yielding 1.8% per annum.

That’s all folks. See you next week!

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Sebastian Bowen owns shares of Bitcoin, National Australia Bank Limited, Newcrest Mining Limited, and Telstra Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Austal Limited, CSL Ltd., Link Administration Holdings Ltd, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited and Telstra Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO, COLESGROUP DEF SET, Transurban Group, Wesfarmers Limited, and Woolworths Limited. The Motley Fool Australia has recommended Collins Foods Limited and Link Administration Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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