31 March 2025 | Weekly Snapshot

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Market Movements

The Australian market was higher by 0.5% last week, which was a bright spot across a bearish global backdrop. Resources and energy were strongest (up 1.3% and 2% respectively), whilst tech stocks led the ASX lower (down 3%). This was reflected by the single stock moves, where Gold Road resources was higher by 20% after a takeover offer. On the reverse side, Block (merger between US-listed Square and ASX-listed Afterpay) was lower by 8% on no news, consistent with the broader market trends where higher-valued stocks are now leading the market lower.

The USA market was down by 3.2% last week. Similar story to Australia – high valuation stocks, such as the technology sector (down 5.3%) and the Nasdaq (down 4.8%) led the market lower. Defensives such as Utilities and Consumer staples were higher by 0.9% and 1.2% respectively. Nvidia was down by almost 10% and Palantir was down by 11%, two examples of 2024’s highflyers now leading to the downside.

On economic news,
• Eurozone composite PMI rose to 50.4
• U.S. manufacturing PMI fell to 49.8
• Australia February CPI inflation falls to 2.4% y/y

A 25% tariff on all non-U.S. made autos was unveiled last week ahead of a broader announcement of reciprocal tariffs set to take effect on April 2. Australia may avoid the worst effects due to its free-trade agreement and near 0% average tariff on U.S. imports. However, Australia may not avoid additional sector specific tariffs related to pharmaceuticals or copper. Fortunately, these exports represent a small portion – less than 1% – of Australia’s overall exports, limiting the direct economic impact. All the same, Australia’s economy will largely depend on the indirect impacts from US tariffs on China.

Portfolio Movements

Broadcom announces solid result

• Broadcom stock dropped 6% during the day as it was caught up with the general market selloff but then soared 16% in after-market trading after releasing solid results.
• Earnings per share of $1.60 beat estimates of $1.51 and revenue was a record $14.92B, up 25% from the year-ago quarter, also beating estimates of $14.59B.
• AI revenue was the big winner +77% YoY to $4.1B while software revenue was +47% at $6.7B. The company said it expects continued strength in AI semiconductor revenue as hyperscale partners continue to invest in AI XPUs and connectivity solutions for AI centres.

Googles updates on Waymo (self-driving cars)

• Washington DC will be the next important capital city to have its own self-driving robo taxis.
• The ride-hailing service will be available in 2026 but there is still legislation to change city laws before a full launch is possible.
• Waymo provides more than 200,000 paid passenger trips each week in San Francisco, Phoenix, Los Angles and Austin Texas, with over 4 million trips in 2024 placing them well ahead of Tesla in the race to this valuable market.

Apple AirPods now approved in Australia as hearing aids

• Apple has just won regulatory approval so Australians can start using AirPods as hearing aids. This is a part of Apples efforts to combat deafness and capture a greater portion of its healthcare ecosystem.
• The Air Pod Pro 2 earbuds will have a software upgrade that turns them into a “clinical grade” hearing aid for mild to moderate hearing loss.
• The software upgrade also allows people to perform a hearing test on their AirPods Pro 2 and an iPod or iPad.

The Week Ahead

• Monday 31 March: China Manufacturing PMI for March expected to be 50.4 in March compared with 50.2 in January.
• Tuesday 1 April: Australia RBA is expected to leave interest rates unchanged at 4.10% and Retail Sales month on month are expected to have expanded at 0.3% in February indicating no change from January.
• Wednesday 2 April: USA S&P Global US Manufacturing PMI expected to be unchanged in March at 49.8, ISM Manufacturing expected to be 49.5 in March down from 50.3 in February. Market is expecting further details from the USA on their global trade partners.
• Friday 4 April: USA Change in Nonfarm Payrolls expected to slow to 138k in March from 151k in February and the Unemployment Rate expected to be unchanged in March at 4.1%.