3 things ASX investors should watch this week

Three young people in business attire sit around a desk and discuss.Three young people in business attire sit around a desk and discuss.

The news never stops for investors with ASX shares.

Here are the three biggest events that could impact your portfolio this week, according to eToro market analyst Josh Gilbert:

1. Australian retail sales figures

Last week Australia’s unemployment rate rose to 3.7%. This is bad news, especially for those losing their jobs, but could be a blessing in disguise for the country.

“That could well mean the central bank leaves rates on pause next month,” said Gilbert.

“Another focal point in the data puzzle impacting the Reserve Bank of Australia’s next move is handed down this week with monthly retail sales.”

After hiking interest rates 11 times in the space of a year, the RBA and investors will be watching carefully at the retail numbers coming out Friday.

“Consumers are becoming more cautious over their spending habits, something the RBA wants,” said Gilbert.

“As a result, this period will see more consumers ‘down trade’, which should benefit consumer staple names such as Coles Group Ltd (ASX: COL), with retail sales being driven by food sales.”

Possibly armed with a COVID-19 savings buffer, retail sales have remained “fairly resilient over the last 12 months”.

“But confidence is near record lows, and households are now really starting to feel the pinch.”

2. Webjet full-year results

Online travel agent Webjet Limited (ASX: WEB) is scheduled to release its latest numbers on Wednesday.

Gilbert noted that travel shares have been some of the best performers in the S&P/ASX 200 Index (ASX: XJO) this year.

“Investors believe the surge in travel demand won’t taper anytime soon,” he said.

“Earnings from travel compatriots globally in the last month have been stellar, with Expedia Group Inc (NASDAQ: EXPE), Booking Holdings Inc (NASDAQ: BKNG), Singapore Airlines Ltd (SGX: C6L) and Emirates all reporting better-than-expected results.”

So the pressure’s on Webjet to show some spectacular performance this week in line with its peers.

“In its half-yearly results, Webjet reported a massive 217% increase in revenue and a 557% jump in EBITDA, but importantly said that profitability should climb above pre-pandemic levels,” said Gilbert.

“Given that travel has come back in a big way, Webjet’s full-year results could spell more good news for shareholders this year, but its guidance may be in focus with headwinds such as labour costs, weakening consumers and recession risks.”

Webjet shares are up 20.2% year to date.

3. Nvidia quarterly results

Across the Pacific, many Australian investors will be interested in the latest figures coming out of NVIDIA Corporation (NASDAQ: NVDA).

The hype around artificial intelligence has put a rocket under Nvidia stocks in 2023, according to Gilbert.

“The investor excitement for this developing technology has sent Nvidia’s shares soaring by more than 100% this year, and so far, the tech giant wears the crown for the S&P 500 Index (SP: .INX)’s best-performing stock of 2023.”

Its first quarter results will be revealed Thursday morning Australian time.

“Investors will be hoping for more good news, but question marks now lie over its valuation with its rally this year,” Gilbert said.

“Nvidia is by far the market leader in developing graphics chips, and this is exactly what is needed to handle the complex calculations required to power AI applications, meaning investors believe Nvidia will reap the rewards from growing demand.”

AI might be boosting its fortunes, but it remains to be seen how much that can offset weak sales in the personal computer market.

“Nvidia said in Q4 it expects US$6.5 billion in revenue, which will be an important number to watch.”

The post 3 things ASX investors should watch this week appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Booking Holdings and Nvidia. The Motley Fool Australia has positions in and has recommended Coles Group. The Motley Fool Australia has recommended Booking Holdings and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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