What Matters Today in Markets: Listen Here each morning
The ASX200 managed to advance +0.35% on Monday although by the close the local index had surrendered well over half of its early morning gains i.e. as we’ve been alluding to of late the markets feeling tired at the moment. The tech stocks were arguably the biggest culprit with most major names opening around their intra-day highs before edging lower throughout the session, in the process totally ignoring the NASDAQ posting fresh 2023 highs on Friday night.
- We believe the rally by rate-sensitive names such as tech is maturing fast with local names already encountering profit talking into strength – more on this later.
Investors continue to look for reasons to avoid stocks with the combination of the RBA’s rate decision this afternoon and reporting season over the coming weeks certainly providing the sceptics with plenty of cause for concern. However, we believe the market has simply got a touch ahead of itself in anticipation of peak inflation/interest rates which leaves room for disappointment if inflation remains stubbornly firm &/or a deep recession unfolds over the coming months.
- We are comfortable edging down the risk curve into any general market upside over the coming weeks.
Obviously, the stock volatility is likely to increase significantly through earnings season e.g. sleep apnoea company ResMed (RMD) rallied +6.6% yesterday after earnings beat estimates sending the stock up to 12-month highs. NAB delivers its half-year earnings report on Thursday before ANZ, Macquarie Group (FY23) and Westpac follow suit over the coming fortnight – again we will touch on these later plus the very popular Macquarie Conference kicks off today.
The local market is set to open down less than -0.1% this morning following a very quiet session on Wall Street.
- We are sticking to our “buy weakness and sell strength” mantra for 2023 but after an exceedingly strong 6 months, we are comfortable increasing cash/flexibility if and when the opportunity arises.
MM has adopted a neutral stance as the ASX200 rotates between 7300 and 7350.
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