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Pre-market futures were indicating a difficult end to the week however some better than expected results after the US market closed meant early selling was subdued. Buyers won the rest of the session and a demand in the match helped the index finish on the intra-day high. Today’s gain helped the index post it’s best week since August last year, snapping 3 weeks of losses.
We felt the ASX200 put in a stellar performance on Thursday to fall less than 10-poinst as US futures fell away during our time zone – poor results from the likes of Meta Platforms, the old Facebook (FB US), and Spotify (SPOT US) after the US market closed more than reversed the gains during their day session e.g. Mark Zuckerberg’s Meta Platforms (FB US) was already down well over 20% in New York late trade. The ASX Tech Sector followed the negative US lead closing the day down 5.9%, by far the worst performer – more on this later.
Portfolio’s exposed to technology had a tough session today with the sector hit nearly 6% following some big moves lower in large cap US tech stocks that missed earnings expectations overnight, while Healthcare also fell. Partially countering that was strength in Utilities., buying amongst the Miners and a solid day for the banks headlined by a decent update from Westpac (WBC) – a few other interesting companies reported which we cover below.
The ASX200 rallied strongly yesterday extending early morning gains on broad based buying that saw over 80% of the index rally – the Energy sector led yet again which has a feeling about it that underweight fund managers are slowly capitulating as crude oil continues to post fresh 7-year highs hence they’re simply missing out, the perfect recipe for a quick sharp rally. Wednesday actually had a surprisingly steady feel about it considering the index rallied over 80-points as buying was consistent but not impulsive as was enjoyed across…
A solid session for Aussie stocks with the market up more than 1% led by the Energy sector, although Materials also bounced back today following a pullback in the $US overnight. Local reporting season is now underway while the US quarterly updates continue to flow through – we should have a better handle on company earnings over the next month however we suspect that guidance will again be fairly vague, particularly in consumer facing sectors.
Tuesday saw the ASX200 rally 0.5% on broad based buying with over 80% of the index closing in positive territory, unfortunately some fairly aggressive profit taking in the heavyweight iron ore miners reigned in the gains. The interest rate sensitive Tech and Utilities Sectors led the line as rising bond yields / inflation is slowly becoming old news. The RBA stepped up to the plate yesterday, the news was largely expected which was illustrated perfectly by the markets deepest and most liquid markets:
A solid session for Aussie stocks today keying off a good session overseas that saw major indices rally into the close. Tech & Utility stocks the main driver however the buying was broad based, 163 stocks in the ASX 200 closed up on the session buoyed by an RBA that kept rates unchanged and ended QE – both as expected whilst also saying they’ll remain patient on further tightening.
Stocks will be glad to see the back of January which saw the local ASX200 fall over 11% from its monthly high of 7620 to its low of 6758 with Healthcare and IT Sectors leading the descent e.g. 50% of the Australian tech names are already down over 20% year to date. The steep decline has made the quarterly range one of the largest in the last decade, especially if we remove the initial panic when COVID first entered our lives back in early 2020. However the declines have been very broad based with 13% of the ASX200 currently in the black while the unpopular Energy Sector dominates the winners…
The final trading session for a tough January saw the ASX track marginally lower, although there was some buying obvious into early morning weakness particularly in some of the beaten up technology stocks while the resources cooled. For the month, the ASX 200 fell -6.35% however there was some huge divergence between sectors, Energy +7.88% for the month while IT fell by -18.43% and Healthcare was off -12.13%. More on these stats below.
We are cutting 2 positions in the portfolio to re-allocate those funds across existing positions that we believe are oversold.
