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MM is trimming OZL
This year we’ve seen stock market sectors dance to the inflation/interest rate tune whereas the underlying index has been a far harder tougher nut to fathom:
The ASX200 rallied another +1% last week but the upside momentum is slowly waning although we still enjoyed more than 80% of sectors closing in positive territory, the Tech Sector led the line rallying +3.25%. The month to month stock & sector rotation continues to dominate proceedings under the hood e.g. the Energy Sector has been the standout of 2022 yet now it finds itself almost friendless while the hammered growth names are rallying akin a popping champagne cork, last week illustrated this perfectly:
The market opened flat this morning but tracked higher throughout the session to close above 7000 for the first time in more than 8 weeks. It was mixed news under the hood with Energy weaker on soft commodity markets, and Tech tapering some of the strong recent gains in the sector. Materials and the consumer focussed sectors made up the bulk of the rally in the index.
The ASX200 reversed early gains on Thursday to close marginally in the red as weakness in the influential Resources Sector more than offset ongoing strength from both the tech and banking stocks. The last few years have seen major stock & sector rotation within the ASX depending on the macro events in focus at the time, since mid-June its been all about bond yields correcting as central banks ease off their hawkish rhetoric while the risk of a recession in 2023 has been increasingly factored into the market, the moves over the last 7-weeks tells a clear tale:
A strong open for the local market however the best of the session was seen before little lunch with the ASX ending flat on the day, closing ~46 points below the session high, back below the 7000 handle. IT stocks continued to perform, particularly the small caps while Energy & Materials fell.
MM are amending our Flagship Growth & Global Macro ETF Portfolios
The ASX200 slipped -0.3% yesterday with the banks weighing on the index while the less influential tech space rallied another +2.4%, the winners & losers were evenly matched on a day when bond yields continued to dictate terms under the market’s hood:
While large-cap Australian shares fell today, the small caps took over the performance mantle with some big moves playing out across the growthier parts of the market, the small ords added +0.83% versus the ASX 200 which fell by 0.32% although the selling was very tepid. Putting that variance in real terms, that saw our emerging companies portfolio add around ~3.70% versus the large-cap growth portfolio which fell by around ~0.10% – some…
As I’m sure everybody knows by now that on Tuesday the RBA hiked local interest rates by 0.5% for the 3rd consecutive month, taking the Official Cash Rate to 1.85%. However there was a noticeable change in their rhetoric with Philip Lowe stating that the path ahead “is a narrow one clouded in uncertainty” and “that the board expects to take further steps in the process of normalising monetary conditions over the months ahead, but it’s not on a pre-set path” – overall it sounded like he was echoing recent comments from the Fed as central banks clearly start…
