27/05/2024 08:48

First Up

The weakness across the ASX on Thursday and Friday was severe enough to leave MM questioning our short-term bullish outlook for stocks, but this morning, the local index is set to regain its composure and open up +0.6%. Some US indices tested fresh all-time highs on Friday night, an impressive effort following the hawkish Fed Minutes earlier in the week. Credit markets have largely taken a Fed rate cut off the table for September, while two cuts by January are now considered far from certain, yet equities continue to advance.

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22/04/2024 09:06

First Up

Last week’s Bank of Americas Fund Managers Survey showed the market is the most bullish in over two years on the back of the biggest jump in global growth optimism since May 2022 – allocations to stocks and commodities hit a 27-month high, at the expense of bonds, with cash levels falling to 4.2% from 4.4% in the previous month - just shy of the sub-4% level that traditionally signals a contrarian sell indicator for equities according to the BofA Global FMS Cash Rule. Conversely, an increasing number of fund managers now believe gold is the most overpriced since COVID. The most crowded trade recognized by fund managers continues to be the "Long Magnificent 7.” Overall, last week was not the best time for Fund managers!

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20/02/2024 09:34

Global Markets

The highly correlated UK FTSE has traded in a similar sideways pattern to the ASX over the last few years, and there are no obvious reasons to pre-empt a breakout in either direction. However, if MM is correct and the Resources Sector outperforms over the coming months, the next 5-10% could be on the upside.

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14/02/2024 09:09

First Up

Yesterday’s earnings numbers largely disappointed the market, with moves likely amplified by “crowded positions” after more than a year where the trend has been the investor's friend. On Tuesday, we wrote, “We are constantly questioning and re-evaluating our views, and at this stage, MM is still working off the opinion that 2024 will be a year of reversion” – one day doesn’t make a summer, but it caught our attention how many outperformers found themselves in the “naughty corner” on Tuesday.

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19/01/2024 09:07

Most local Tech stocks are shrugging off the bounce by yields

We are less than three weeks into 2024, and it's evident that today's market is focusing more on the micro/stock news as opposed to the macro, at least for now. The US NASDAQ registered fresh all-time highs overnight, even as Fed members attempt to rein in the market's optimism with regard to rate cuts in 2024, i.e. a market that rallies on bad news is a strong market.

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19/12/2023 09:22

Global Markets

Overnight saw US equities maintain their upside momentum with “Big Tech” again leading the charge, the NASDAQ touched its all-time high during the session and looks destined to test the psychological 17,000 area in the coming weeks, now only +1.5% away.

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15/12/2023 09:37

How far can equities rally with a new look dovish Fed?

This week’s recent dovish tilt by the Fed has made us tweak our already bullish outlook higher; now, we wouldn’t be surprised to see the ASX200 make new all-time highs in 1Q of 2024 - Never say never! Ever since the GFC over 15 years ago, the ASX200 has been trending upwards with a few 15-20% corrections along the journey.

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20/11/2023 09:01

Equity Indices

The ASX200 is set to open firmly this morning, with the Financials and Energy Sectors likely to be most supportive if we take our lead from overseas bourses. At MM, we remain believers in a Santa Rally this year if for no other reason than we’ve seen it so often in the past, with November already up ~4%, it's hard to recommend chasing strength, but we do see further upside over the coming weeks.

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15/11/2023 09:11

Global Markets

US indices surged overnight as US inflation came in below expectations; consumer prices rose +3.2% YoY for October, down from 3.7% YoY in September, which unleashed a flurry of buying across all sectors – remember, fund managers went underweight stocks in October! With US 10-year yields tumbling ~0.2% overnight, hitting levels not reached since September, equities are suddenly finding reasons to be cheerful.

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13/11/2023 08:54

Equity Indices

The ASX200 is set to open back above 7000 this morning, with a 40c advance by BHP Group (BHP) in the US set to be supportive early this morning. The Friday night rally in the US was headed by a surge in big tech aided by a relatively calm session across bond markets as investors enjoyed a lack of major surprises from Fed speakers – the “no news” path of least resistance is higher for US indices.

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