ASX 200 afternoon report: 21 March 2024

The ASX 200 trades 84 points (1.10%) higher at 7780 at 3.00pm AEDT

Today, the ASX 200 surged as a wave of relief swept across regional equity markets following the Federal Reserve's decision to keep rates on hold this morning, reaffirming its outlook for three rate cuts this year.

While there were concerns that after a run of firmer data, the Fed might signal just two rate cuts in 2024, the Fed chair said the committee had anticipated inflations return to target would be “bumpy” and had chosen to look through the hotter than expected data.

After being slow to respond to the initial signs of inflation, the RBA isn’t anywhere near signalling rate cuts yet, and is perhaps lamenting its decision on Tuesday to water down its mild tightening bias, as jobs data for February surprised to the upside.

Strong job growth in Australia: unemployment rate drops to 3.7% amid surprising economic data

The Australian economy added 116.5k jobs in February following a 0.5k gain in January, well above the 40k gain expected. The unemployment rate fell to 3.7% from 4.1% and the participation increased by 0.1 percentage point to 66.7% after being revised lower last month.

The ABS noted that the solid job growth in February followed a larger-than-usual number of people in December who had a job they were waiting to start or return to. With seasonal issues, again evident in the data, it will cause some hesitation in reading too much into the headline number. That said, it is hard to escape the fact that the unemployment rate, which is probably the cleanest read, has fallen back to 3.7%, where it was six months ago.

ASX 200 stocks

Banking sector

Despite the robust jobs data sending Australian bond yields higher across the curve, the interest rate sensitive ASX 200 sectors have outperformed.

• NAB: +2.50% to $34.75
• Westpac: + 1.75% to $26.64
• CBA: +1.56% to $117.44
• Macquarie: + 1.14% to $198.98
• ANZ: + 1.03% to $28.98

Property sector

The ASX 200 property sector hit a fresh two-year high today

• Goodman Group: +2.4% to $31.16
• Mirvac: +2.34% to $2.19
• REA Group: + 2.05% to $188.56
• Centuria Group: +1.4% to $1.82

Tech stocks

With the Fed out of the way for another six weeks and the buzz around tech and AI set to retake its place in the driver’s seat, local tech stocks have not hesitated to build on recent gains.

• Zip: +8% to $1.49
• Tyro Payments: +3.13% to $1.07
• Xero: +2.88% to $136.01
• Life360: + 2.58% to $13.29

ASX 200 technical analysis

After today’s thumping rally, the ASX 200 is set to close above the uptrend support at 7750 that it broke below last week. This development negates the short-term downside risks and opens up a retest of the all-time high of 7853 in the sessions ahead before a push towards 7950.

ASX 200 daily chart

• ^{Source: TradingView. The figures stated are as of 21 March 2024. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}