Morning Report Friday 6 June 2014
The ECB moves to negative rates and Online sellers get hammered
Two points caught my eye this morning, negative interest rates in Europe and a total market turnaround on a sector.
The ECB amongst other significant stimulatory measure cut its deposit interest rate to -0.1% - yes minus!!
On line fashion retailer ASOS tumbled 31% as company forecasts were well below expectations.
Other major European on line retailer’s also got sold heavily as sentiment changed dramatically to the sector e.g. Boohoo -9.1% and Yoox SpA -6.1%. The Australian market has not got a major foot print in the on line retailing space being very late to the party with the likes of David Jones and Myer gaining traction but it clearly remains a fringe part of the businesses compared to shop front retail. With the NASDAQ (chart 1) hitting fresh 2014 highs a few hours ago as forecast last week I feel it’s time to again cast our eyes over the domestic “internet stocks” – a very fickle sector.
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