Australian Investment Blog

WHAT MATTERED TODAY

The banks lead the buying today , as the market opened strong and was bid up throughout the session, some relief after three days of selling. One of the better performers in the market was, ironically, the exchange itself after they announced plans to move its settlement system to a Blockchain system – the same tech that underpins Bitcoin (I think) – however we’ll cover that more in the AM report tomorrow, authored by Denis, who is a lot more tech savvy than I. From my perspective, and for someone that has operated in the market for many years, the archaic system of settlement that we currently operate under needs a lick of paint, or more accurately a complete new framework.

Financials all performed strongly today, and the big four were the catalyst for much of the markets gains – accounting for a third of the advance on the ASX 200. Overseas earners also got a boost from a lower Aussie dollar, notably CYB which jumped +1.841% to close at $5.64. We own it in the Growth Portfolio

On the broader mkt today, buying was strong on the open and continued higher throughout the session. The IT stocks did best adding +1.34% while Industrials dragged, but still finished in the green. An overall range today of +/- 43 points, a high of 5987, a low of 5944 and a close of 5977, up +32pts or +0.54%.

Looking more broadly, the local ASX200 has now been trading in a tight 2.2% range around the psychological 6000 area for the last month as investors question whether we will get a Christmas / window dressing rally again in 2017. Remember on average the market advances +2.5% in December but the gains usually don’t kick in until the middle of the month i.e. next week.

Our overall the view at MM on the ASX200 has not waivered:

• We remain bullish the ASX200 into 2018, targeting an eventual solid break over 6000.
• Short-term a pullback under 5900 would not surprise but we would be buyers here looking for a Christmas / window dressing rally.

ASX 200 Intra-Day Chart

ASX 200 Daily Chart

TOP MOVERS

1. ASX Limited (ASX) – – jumped +0.70% after announcing that the dated CHESS system used for clearing and settlements would be replaced by a distributed ledger system, known as blockchain. ASX is the first major global exchange to make the jump and, while there may be some hassle in the conversion, it will enable more players into the market at a lower cost and lower settlement risk, and likely to increase volume through the exchange to the benefit of ASX. We like it!

ASX Daily Chart

2. Tassel Group (TGR) – The stock was downgraded to ‘underweight’ (sell) by JP Morgan, and that’s all it took to send the Salmon producer and seller down 9% today. A left field company in the top 200, TGR has struggled this year as bulk Salmon prices fell.

Tassel Daily Chart

OUR CALLS

Telstra (TLS) - we reduced our holding in Telstra today by 5% in the Growth Portfolio. We did not get filled in JHG in the Growth Portfolio given the stock traded up strongly today.

Have a great night

James & the Market Matters Team

Disclosure

Market Matters may hold stocks mentioned in this report. Subscribers can view a full list of holdings on the website by clicking here. Positions are updated each Wednesday orFriday, or after the session when positions are traded.

Disclaimer

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