The recent slew of company results shows the torrid impact the coronavirus is having on Australia, backed up by a bleak set of economic data.
Reserve Bank governor Philip Lowe warned last week the economy will not return to normal for sometime yet, meaning interest rates could be at record lows for three years, and unemployment will remain high.
This grim outlook came as the number of Australians unemployed topped one million for the first time, wages growth slumped to a record low and confidence among consumers and business tumbled due to the Victorian Covid-19 outbreak.
AMP Capital chief economist Shane Oliver says it is also clear from the company reporting season so far that earnings have been hit hard by the coronavirus.
He calculates that so far only 25 per cent of results have exceeded expectations compared to a norm of around 44 per cent.
“Consensus expectations remain for a 21 per cent slump in earnings due to the hit from coronavirus,” Dr Oliver said.
The reporting season continues this week, including heavy weight miner BHP on Tuesday.
The Australian share market looks set for a weak opening with stock futures pointing to a 40 point or 0.7 per cent fall at the opening.
The decline came as a slowdown in US retail sales growth kept a lid on gains on Wall Street.
While the Dow Jones Industrial Average rose by a slim 34.3 points, or 0.12 per cent, to 27,931.02, the S&P 500 lost 0.58 points, or 0.02 per cent, to 3,372.85 and the Nasdaq Composite dropped 23.20 points, or 0.21 per cent to 11,019.30.
The Australian S&P/ASX200 benchmark index ended Friday 35.2 points or 0.58 per cent higher at 6126.2 points.
It gained just over two per cent for the week, the best performance since early July.
The pace of economic news slows this week, but will include the release of the minutes from the Reserve Bank’s August board meeting on Tuesday.
However, after taking into account Dr Lowe’s post-meeting statement, the central bank’s quarterly statement on monetary policy and his appearance ahead of the House of Representatives economics committee on Friday, the minutes probably won’t offer much new information.
Tuesday will also see the release of the weekly ANZ-Roy Morgan consumer confidence index after recording a seventh week of continuous decline last week.
How this weakness in impacting on spending may be seen when the Australian Bureau of Statistics releases preliminary retail trade data on Friday.
Before then, the Department of Employment, Skills, Small and Family Business will release its monthly job vacancy report on Wednesday.
