Month: November 2014
Iron Ore continues to make 5 year lows, will stocks follow or bounce from here?Last night Iron Ore fell 1.4% as Nourei Roubini, the Chairman of Roubini Economics, called Chinese growth to slump past 5.5%. In my opinion, well beloq the target prices currently suggested for equities and commodities. However, I have been targeting Fortescue (FMG) to fall under $3 and this could potentially provide a trading opportunity. These levels are likely to be reached today so do we pull the pin? What does concern me in the bigger picture is how well our Iron Ore stocks have performed compared to their international competitors, I assume investors are factoring in a significantly lower $A to their valuations. For example – Vale, the world’s largest Iron Ore producer, is pluming levels not seen since 2005 whereas the main 3 Australian producers are still trading approximately double the corresponding levels.
The ASX200 was significantly stronger than I expected today closing at 5549, up 43 points (0.78%), an excellent effort with both ANZ and NAB trading ex-dividend.
Gold is getting interesting, as panic sets in for the precious metal
As anticipated, the ASX200 ended lower, down 12 points, or -0.2% at 5,506 after trading as high as 5,548 in the morning.
** Commonwealth Bank (CBA) posts a $2.3B quarterly profit**
It was a roller coaster ride in the ASX200 today, ending the day down only 2 points at 5,518 after falling 39 points intraday.
As expected, it was a quiet day, with the ASX 200 closing only 13 points higher at 5,520. As we anticipated, the RBA announced no change to interest rates this month.
On Cup Day, what else could we revisit than the gaming stocks? Especially with Barrangaroo Sydney Casino development evolving rapidly and the second Brisbane casino licence up for grabs. Both Crown (CWN) and Echo (EGP) are in the running for the Brisbane licence and the winner is likely to get a nice lift in its share price, even if revenue will be years in the future. The dominant factor for overseas casinos has been the regulatory clamp down on “junkets” out of China and this has led to a significant fall in the Crown share price with the other 3 stocks discussed below, likely to have been a part beneficiary of the funds exiting Crown.With my overall market view targeting a 15% correction to US equities as the next major move, albeit likely to be from higher levels, I am reticent to be a buyer of stocks in general at current levels, but the gaming sector has a low correlation to the ASX200, especially due to regulatory decisions having major impact on the company’s operations.
We begin our Monday morning overseas equity segment logically with Apple (APPL.US), the largest company in the world.
The ASX 200 closed 20 points (-0.4%) lower at 5,507, led by the Gold sector.
Really bullish, there's more to go in the reflation rally
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