Australia holds interest rates at 4.1%: potential future increases

Australian interest rate

On August 1st, 2023, it was mentioned that Australia has decided to keep its interest rates at 4.1%. This indicates that there might be a need for further increases in the future. HSBC, a major bank, has raised its outlook because its profits have exceeded expectations, which is good news for investors.

European equities

There is also going to be a big wave of European companies reporting their earnings, including IMDb, Greggs, Diageo, and Pfizer. However, the European market is expected to open slightly lower.

Stock market index

The FTSE, a stock market index, is showing a positive long-term perspective and has the potential to climb up towards the 7800 level. The CAC and DAX, which are also stock market indexes, are slowly making progress as well.

CSI 300 and Hang Seng indexes

In Asia, China's CSI 300 and Hang Seng indexes have been doing well this month, experiencing their biggest monthly gains since January. However, the Nikkei index in Japan has remained unchanged. Wall Street, the stock exchange, had a strong performance in July thanks to positive company earnings and optimism about the US economy. At the beginning of the day, cautious trading is expected.

The Reserve Bank of Australia

The Reserve Bank of Australia has decided to keep its interest rates at 4.1% for the second month in a row. Meanwhile, HSBC is rewarding its investors by buying back up to $2 billion of its own shares. The bank's profits for the first half of the year have more than doubled, and it has increased its near-term return on tangible equity goal.

China's factory activities

China's factory activities saw a decline in July due to lower demand from suppliers and fewer export orders caused by market conditions both abroad and domestically.

UK house prices

In the UK, house prices fell by 3.8% in July compared to the previous year, which is the biggest drop since July 2009. This has affected house builders like Persimmon and Taylor Wimpey, who are also facing challenges.

Oil prices

Oil prices have reached their highest level since April 17th, with the expectation that organization of the petroleum exporting countries (OPEC) will extend voluntary cuts for an additional month.

The demand for oil in July reached a record high of 102.8 million barrels. However, BP, a major oil company, reported lower-than-expected profits for the second quarter of the year, as oil and fuel prices have cooled down.

Greggs

On a positive note, British bakery and fast food chain Greggs reported a 14% increase in profit for the first half of the year and remains on track to meet its annual forecast. Diageo, a company that makes spirits, also had good results, with a 6.5% rise in sales in the year to June 30th, slightly surpassing analysts' expectations. As for gold, its price has been slowly rising and is currently attempting to break through the resistance level of $1980.

Gold outlook

Central banks have been buying gold, which has supported its demand. However, overall demand for gold has slightly decreased in the second quarter of 2023.