31 May 2021 | Weekly Snapshot

Did you know?

Global government debt at the end of 2020 was $81 trillion, up from $21.6 trillion in 1995, equivalent to $16,911 for each person alive.

Market Movements

Australian Share Market (ASX200) – Up 2.18% last week. The Australian market managed its second week of gains, helped by a recovery in resource stocks and the continuation of the bank rally, punctuated by the share price of CBA bursting through the $100 mark for the first time.

US Share Market (S&P 500) – Up 1.16% last week. Major indices posted weekly gains with the S&P 500 breaking two weeks of declines. Overall a quieter week with volatility dropping and smaller price movements. The week begins with a holiday in the US tonight for Memorial Day.

Portfolio Movements

Apple (AAPL.NAS) – Apple has overtaken Amazon to be the world’s most valuable brand for the first time in five years as the company expands into digital and subscription services. The brand value jumped a massive 87% in the past year to hit $263.4B. Amazon’s brand grew 15% to $254.2B as it benefited from stay-at-home orders and surging demand but also from its diversification strategy including its online pharmacy, Halo fitness tracker, Echo home products, Amazon prime, Music, TV, security etc. Google was third at $191B, followed by Microsoft and Samsung. The UK was the worst performing country, with its combined 21 brands amongst the world’s top 500 falling 11%, but Shell kept it’s place as the UK’S most valuable brand.

Commonwealth Bank (CBA.ASX) – Commonwealth Bank have invested $30M into a local e-commerce start up, Little Birdie, which has yet to launch and bills itself as a new homepage for online shoppers (with over 70M products) to search, compare, track and share deals. Despite not being open for business, over 1000 retailers have signed up and the intention is to give access to CBA’s 11M customers through their mobile banking apps and ecosystem. This will give critical mass to the AI technology used helping customers vote and promote the best deals available. CBA would also look to tie in other related investments, such as Klarna and CommBank’s own buy now pay later service to make purchases. Data driven personalised offers will be exclusive to CBA customers and will be based on their spending habits.

Sony (SNE.NYSE) – Sony yesterday committed to spending over $US18.39B over the next 3 years including expanding its gaming and entertainment services from 160M consumers to 1 billion. Sony will target other strategic investments, but it’s no coincidence that the Japanese government also announced it wants Taiwan Semiconductors (TSMC) and Sony to invest $9.2B to build the country’s first chip manufacturing plant. The potential factory would be built close to Sony’s image sensor plant, which is already a world leader and dominates in this technology. This may be a wish list for the Japanese government but it makes sense to partner with the world’s largest chip manufacturer (TSMC) and addresses the need for the country to secure essential tech items.

The week ahead

Domestically, a busy week on economic releases with Australian GDP growth figures potentially showing the economy returning to pre-covid levels. Also expect retail sales, manufacturing PMI figures, balance of trade and the RBA interest rate decision tomorrow.

China today releases important manufacturing PMI revealing the degree of inflationary pressures and the US has important releases such as the Unemployment Rate and Non-Farm Payrolls which will be watched closely after last month’s surprise figure. US Manufacturing PMI figures will give further indications of inflationary pressure.

Public holidays in both the UK and the US will see markets get off to a quiet start this week.