ASX Weekly Market Outlook and the Top Movers Last Week (ASX:XAO)
The week been saw a large pullback in the All Ords [ASX:XAO] by 208 points. Meaning the XAO is now in its 10th week of a sideways move after gaining ground quickly from the March low.
ASX Outlook for the week ahead
The week ahead may be another week down as last week recorded a large drop in price with the market closing at the bottom of the trading range for the week.
With the JobSeeker and JobKeeper payments finishing up at the end of March, spending around the country may dry up very soon.
In line with the end of the government support is the finalisation of the mortgage deferral programs at the end of March.
With it being reported that borrowers are being pressured by banks to make ‘significant, bulk’ payments as loan deferrals begin wrapping up.
All up there looks to be significant downward pressure building for the All Ords.
If the All Ords continues its move down, then the level of 6,787 and 6,453 may become the focus.
A closer Look at the ASX
The week been saw some large movements both up and down in shares.
Looking into the sectors, Consumer staples moved up 1.11%, while Utilities gained 1.29%.
On the downside, Materials declined 1.32%, while Financials and Energy fell back 2.79% and 8.89% respectively.
A broader look at the ASX
The All Ords was kept alive to a degree throughout 2020 by the high iron ore prices, with a lot of the material being shipped to China.
Throughout 2020, China’s hunger for iron ore saw the share price of Fortescue Metals Group go through the roof, helping the recovery of the All Ords along the way.
Now it looks like that the hunger for iron ore may be tapering off.
Iron ore prices fell back last week after data showed five straight weeks of lower production by Chinese steel mills, which forge more crude steel than the rest of the world combined.
If the trend continues in iron ore prices, combined with the end of the JobKeeper program, along with the end of the mortgage deferral program, it might be the perfect storm for a fall in the All Ords.
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