Local stocks yet again fail to follow the global positive lead – CYB, STO, RRL
This morning, the futures market was indicating an open ~15-points higher for the ASX200, but the big selling returned to the futures market early in the day and we found ourselves down over 40-points / 0.7% by midday. Today’s selling was broad based with particular weakness in the banks / financials, energy, retail / supermarkets and the iron ore sector with a relief bounce for insurance stocks catching the eye on the upside. While the aggressive futures selling persists, it’s hard to envisage our market managing anything but relatively small counter-trend bounces and a thrust under 5600 feels like just a matter of time.
Overall, today’s weakness comes as no major surprise to MM as we are targeting a break to the downside from the current 20-week trading range between 5629 and 5836 with our ideal target a test of the psychological 5500 area.
Today we sent out 2 alerts which were filled in the market plus we are still working a sell order in CYBG Plc (CYB) to sell half our holding at $5.30, these are explained later in the report. Our cash position in the MM Growth Portfolio is now at 14%.
The ASX 200 had a range of +/- 51 points, a high of 5702, a low of 5651 and a close of 5652, -49 points / -0.87%
ASX 200 Intraday Chart
ASX 200 Daily Chart
1 CYBG Plc (CYB) $5.21
We remain overall bullish CYB, but are comfortable taking profit on 50% of our position recently at our initial target around the $5.30 level, at this stage we do not envisage lowering our sell level.
CYBG Plc (CYB) Weekly Chart
2 Santos (STO) $3.97
Today Santos fell into our buy area, identified last week around the $3.95 area. We have allocated 3% of our portfolio to STO at $3.95, eventually targeting close to $4.50, plus we may consider averaging the position ~$3.75.
Santos (STO) Daily Chart
3 Regis Resources (RRL) $3.65
Today we dipped our toe into the water and allocated 3% of the MM Growth Portfolio into RRL around $3.66. We are looking for a ~10% rally which may coincide with some short-term weakness in equities – RRL will often move in an opposite direction to the overall market.
Regis Resources (RLL) Weekly Chart
Have a great night
The Market Matters Team
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