Archives: Reports
Equities have really struggled since the short squeeze/optimism fuelled 2-month rally that ran out of momentum in mid-August, in just 3-weeks the US S&P500 has fallen by -9.7%. It’s very easy to blame Jerome Powell’s hawkish rhetoric from Jackson hole for the decline but stocks were already slipping before he spoke and they’ve extended the declines afterwards with the Resources Sector compounding local losses following Chinas lockdown of Chengdu, another drastic attempt by Beijing to achieve Covid-Zero that feels capable of spreading to other cities. It’s very important that subscribers…
The ASX200 was clobbered last week firstly by last Fridays extremely hawkish statement from Jerome Powell out of Jackson Hole, which sent US 2-year bond yields to 15-year highs, plus the news’s later in the week that China had locked down a city of 21 million people following an outbreak of just 1,000 Covid cases – NSW had 4,169 reported cases yesterday and we’re now even allowing internal flights without masks! Resource stocks were some of the worst hit over the week, especially in the last few days, as iron ore hit a 10-month low and copper looks destined to test its 2-year low:
No one wanted to go home long on Friday afternoon it seems with the ASX 200 losing ~40pts in the last 2 hours of trade, giving back an early lead following a decent recovery from the lows in the US overnight. Employment data is due out tonight and that will have a big bearing on where interest rates go in the short term, market expectations are for +298k jobs to be added while the unemployment rate will stay stable at 3.5% – clearly still a very tight labour market.
The ASX200 has kicked off September in a similar tone to the back-end of August, yesterday’s 141-point drop may have felt particularly aggressive to some observers but we shouldn’t lose sight of the significant influence of BHP trading ex-dividend, it was effectively 33% of the whole markets decline! However, the broad-based selling which resulted in less than 10% of the main board managing to close up on the day would have delivered some definite Spring cheer to the bears. Globally we saw stocks and bonds (rates higher) extend their recent slide as China lockdowns amplified the market’s worries post Jackson Hole.
The market was hit hard today following weakness overseas and a raft of ASX companies trading ex-dividend – BHP had the biggest bearing trading Ex $2.4707 fully franked taking 46pts off the ASX 200, simply a huge influence on our little market these days!
The ASX200 said goodbye to August with another choppy session around the 7000 level, last month may have seen an attempt to break both under 6900 and above 7100 but come the 31st more than half of the month’s action unfolded close to the psychological 7000 area. Under the hood, it was a very different story at times as stock/sector rotation remains the main game in town after an interesting reporting season that saw more beats than misses but an underlying cautious tone towards…
A soft open following a 1% decline in the US overnight, however, traders stepped up to the plate in a big way pushing the ASX 200 +50 pts above the session lows. The IT and Financial stocks led the charge to end what can only be called a flat month for the ASX overall, the index fell just -0.09% for August which covers up some big moves under the hood.
Over the last 2-weeks on Ausbiz our Research Lead Shawn has mentioned how cryptos and especially Bitcoin can be a leading indicator for stocks, the chart below illustrates perfectly how in November 2021 Bitcoin topped out about 2-weeks earlier than the US Tech Sector, they subsequently rolled lower in tandem as “risk off” has become the new norm, the current read through for liquidity and risk assets is one of clear short-term caution:
The ASX bounced back today following a 2% sell-off yesterday with the IT & Energy stocks leading the charge as we trickle towards the end of a hectic reporting period.
A few words from Jerome Powell was enough to whack the ASX200 yesterday with only 2% of stocks managing to close up on Monday but the -1.95% sell-off still felt restrained compared to US indices – although we did post fresh 4-week lows on the day. There was no particular surprise with yesterday’s reaction to Jerome Powell’s comments from Jackson Hole and subsequent aggressive sell-off across US stocks, the interest rates sensitive local Tech Sector fell -4.4% to be worst on ground although there was nowhere…
