Banks strong – resources weak to end the month
What Mattered Today
Resources provided most weight on the market today with the likes of RIO and BHP down more than 4% a piece while CBA added +1.14% and the other banks were reasonably strong. This rotation out of resources is something we’ve been looking for over the past few weeks and until now, it’s been illusive – that said, you want to be early on a call like this than late as the market moves very quickly – we started to see weakness creep in today.
BHP Billiton (BHP) Daily Chart – BHP took 11 index points off the market today, which accounted for around 65% of today’s loss on the index
Commonwealth Bank (CBA) Daily Chart
It’s interesting that we’re now seeing the $US drop as well as resource stocks BUT we did see them rise on $US strength which failed to make a lot of sense. Commodities are priced in $US and clearly strength there should be a headwind, and when it’s not, questions should be asked.
The commodity markets, particularly Iron Ore is being dominated by speculation and that’s obvious in the big intra-day swings we see on the Futures. We continue to see lower prices for commodity stocks in the near term – and we think Iron Ore has now peaked
Iron Ore Monthly Chart
We had a range today of +/- 35 points, a high of 5458, a low of 5423 and a close of 5440, off -17pts or -0.31%. Volume strong, over +30% above the 20 day overage.
ASX 200 Intra-Day Chart
ASX 200 daily chart
Sectors
ASX 200 Movers
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What Matters Overseas
FUTURES mixed….
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