Updated June 12, 2017 21:10:35

Photo: Apple CEO Tim Cook may have his work cut out promoting the new iPhone as concerns his stock is overvalued (Reuters: Beck Diefenbach)

It wasn't exactly the Tech Wreck mark 2, but Friday's dumping of Wall Street's digital darlings is a warning that things are looking rather pricey on US markets.

It was the biggies — Facebook, Amazon, Netflix and Google's parent Alphabet — that did the damage, all falling more than 3 per cent.

The banks and energy stocks fared somewhat better, helping the Dow Jones index up, but there is a growing sense that something is going to have to give in the US; either earnings will have to rise to justify share prices, or prices will fall.

The tech sell-off was in large part due to some rather cautious research about the sector from big brokers like Goldman Sachs, but news that Apple's new iPhone has potentially slower downloads than some rivals didn't help matters either.

Overall it was a pretty poor week on equity markets around the world.

The US was down 0.3 per cent, Japan and Europe fell as well, but not as much as Australia's almost 2 per cent slide.

It was the worst week in what has been a pretty lame year so far on the ASX. The S&P200 is up just 0.2 per cent and the All Ordinaries is now underwater.

It could be more of the same this week, with futures trading on the ASX swinging from positive to negative over the long weekend.

Jobs growth defying a slowing economy

Locally jobs figures (Thursday) will be the focus, with economists somewhat baffled by ongoing strength in the face of other data pointing to weakness in the economy.

ABC business reporter Michael Janda explains how the jobs data are calculated and what to look for in the figures.

The consensus view is around 10,000 jobs will be added, but within that there is a large spread of thinking.

The NAB, influenced by its own business survey — one of the more positive readings in the welter of numbers — says its modelling points to 21,000 new jobs and the unemployment rate unchanged at 5.7 per cent.

Citi is punting on a net 7,500 loss of jobs with, like NAB, the "official" unemployment dial unmoved.

Citi's Paul Brennan noted, on paper at least, the Australian economy created 49,000 new jobs across March and April, well above the post-1991 recession average of 14,000 new jobs a month.

"Sub-trend economic growth is not compatible with such recent strong jobs growth. We expect some of this to be retraced in May," Mr Brennan said.

Back at the NAB, Tapas Strickland said rather than just focussing on the headline numbers, the market should also keep in mind the wider measures of labour market slackness.

"The underutilisation rate, which comprises both the underemployment rate and unemployment rate, remains elevated driven by greater underemployment — those wanting to work more hours but are not able to," Mr Stricklaand said.

"Elevated underemployment has been a key drag on wages growth over the past few years and inroads in this will be needed in order to lift wages growth."

Wages as a share of GDP have fallen to their lowest level in more than 50 years, eroding household spending and slowing the economy, writes Stephen Letts

The other bits on information will be NAB's business survey (Tuesday) — which as noted has conditions and confidence running along above their long-term averages.

On the other hand, consumers get their chance to vent some spleen with weekly and monthly surveys (Wednesday) likely show that pessimists are out-numbering optimists, and they are spending more but enjoying the experience less.

The Fed to lift rates, others to stay on hold

From a global perspective, the meeting of Federal Reserve's rate setting committee — the FOMC — on Wednesday (early Thursday AEST) is the big calendar item.

Over the weekend, the market priced in a better than 90 per cent chance of 25 basis point hike.

That would be the fourth hike in this tightening cycle, which will see the Fed Funds rate lifted from zero to a range of 1.00-to-1.25 per cent.

Given the decision is almost a forgone conclusion — expect a bit of mayhem if it is not delivered — the interest will be on the post-decision statement and the voting members' dot-plot to see whether there is another hike likely this year.

The Bank of England (Thursday) is likely to hold again, while the Bank of Japan — which is starting to see some returns from its extraordinarily loose policy — is also likely to leave settings untouched (Friday).

Has China developed the wobbles again?

Weak recent manufacturing data has again raised concerns about the world's second biggest economy.

The big monthly data dump — retail sales, fixed asset investment and industrial production — on Tuesday may provide some greater insight.

Retail sales are forecast to ease a fraction, but still be growing at about 10.7 per cent annually, FAI — a proxy for infrastructure and construction spending — is forecast to kick higher, while industrial production could well slow again.

The uncertainty is certainly not helping the iron ore price find a floor, with market having just recorded it fifth fall in six weeks.

Imports rose another 5.5 per cent in May, further adding to 136 million tonne iron ore mountain building up around Chinese ports.

That sent futures contracts down another 1.4 per cent on Friday, and the spot price eased as well.

Oil gained a bit of ground on Friday, but that was largely due to a leaky pipe in Nigeria, Africa's biggest producer.

Friday's 0.4 per cent gain in the global benchmark, Brent crude, should be measured against a 4 per cent decline over the week, which is probably a more accurate indication of where things are heading.

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Topics: company-news, economic-trends, stockmarket, australia, european-union, united-states

First posted June 11, 2017 11:07:15