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MM are selling PDN in the Emerging Companies Portfolio, taking a loss around 72c
The ASX200 again tested the psychological 7200 area late yesterday morning before drifting lower and ultimately surrendering over half of its morning’s gains to close up just 35-points for the day. We may be only 2-months into 2022 but MM’s view that the year would be characterised by significant volatility on both the stock and sector level is looking even more on point than even we imagined, a quick scan of some of the major winners & losers over the last 9-weeks says it all:
A choppy session for the ASX overall today with some big divergence between the haves and have nots, the Resources & Energy sectors again the beacon of hope while Healthcare and Staples tapered off. While it was a positive day overall, only around 50% of companies on the ASX finished in the green, and their were some big moves on either side of the ledger.
The ASX200 delivered a stellar performance on Wednesday by rallying 20-points in the wake of a 600-point plunge by the Dow – as we said yesterday “MM still feels that stocks want to trade higher”. We may have seen 65% of stocks decline yesterday but the stellar gains across the Energy, Gold and Resources Sectors was enough to carry the index higher. Some subscribers may have been surprised to see our sell alerts cross their screens yesterday but I remind you of a couple of famous investing quotes plus a personal favourite of one of the MM team:
A solid underbelly from the market today to close marginally higher despite US stocks falling more than 1.5% overnight plus our influential banking sector ended the session lower. Energy again the standout with Oil up ~10% in Asia, which is huge while the broader Materials sector was also bullish. The composition of our index, being tilted towards resources helped the local market outperform the US by ~5% in February and continues to have a positive impact, this was a key call for MM this year.
We are reducing our exposure to Oil & Gold across various portfolio’s.
Tuesday saw the ASX200 gain 0.7% but It was significantly higher at lunchtime before US futures started drifting lower reminding local investors that Eastern Europe is in the midst of a very scary war. Gains were still broad based with almost 70% of stocks closing up on the day but a reversal by the big miners reined in the markets gain even as the IT Sector surged well over 5% – with the current Ukraine crisis stock / sector rotation moves are struggling to be sustainable for more than a few days.
A solid morning session for the ASX with the market peaking +110points higher at midday before the afternoon was filled with sell orders, a +47pt gain a disappointment overall. The IT stocks were strong rallying +5.66% as a group to be the clear standout – when this sector rallies, it will rally hard, however it has experienced a few false starts of late. We’re bullish tech in the short term and can see a short, sharp aggressive bounce unfolding from here.
The ASX200 promised so much on Monday but ultimately delivered just a little as Ukraine tensions came back to the fore as Belarus entered the affray and the West continue to gear up sanctions against Russia – before the ASX even opened US stock futures were down over 2%, gold spiked almost $US40/oz higher and brent crude soared 7%, back above $US105/barrel. MM is looking for a few weeks choppy action across financial markets, which is hardly a grandiose call but if yesterday is anything to go by we feel smack on the money.
The ASX closed higher today however by a lesser margin than the futures had implied on Saturday morning (+165pts) following a strong rally on Wall Street, the weekend news flow took some the sheen off Friday’s impressive gains. Still, the ASX finished +0.70% despite US Futures trading -2.7% lower at their worst today while Asian markets also fell into the red. Materials & Energy stocks were well supported while the risk off IT sector led the other side of the ledger.
