Archives: Reports
A positive session for the ASX today underpinned by strong gains in the IT and Material sectors – higher commodity prices and lower bond yields a catalyst however we also saw stock specific updates that were generally very positive. Overall, a solid session, particularly for how Market Matters portfolios are positioned.
The ASX200 closed yesterday at the same level it reached in early June i.e. more than 3-months later the market remains unchanged albeit after a failed foray above 7600 in August. We’ve witnessed plenty of sector rotation in the last quarter even if the underlying index has failed to make any discernible headway, the choppy swings between various stocks and sectors has been consistent in its inconsistency but over the months there have been a couple of standouts:
Another session that closed in the red for the ASX, it’s 3rd straight but again it was more about the influence of the sectors that fell. Given financials & materials which account for ~40% of the market ended down, it was actually positive to see the market off only 8 points implying that a greater volume of stocks finished the session in the green. As we’ve been writing in recent notes, the market is taking a plethora of bad news largely in its stride & a market that holds up in the face of negative news flow generally has underlying strength.
The ASX200 had a fairly quiet Tuesday finally closing down 0.26% in a lackluster session which saw no stocks rally, or fall by more than 5%. The Tech Sector continued to struggle even on a day when the Energy names took a well-deserved breather. Over the day US S&P500 futures appeared to direct traffic on the local market i.e. when they rallied early in the morning the ASX200 advanced around 30-points only to reverse the early gains as the US futures followed Asian indices lower after Sinic Holdings (2103 HK) became the latest Chinese real estate firm…
A lackluster session for the ASX today, initially up but that didn’t last long although the sell-off was hardly aggressive. Healthcare bounced and so too did the supermarkets highlighting the risk off sort of session.
On Monday the ASX200 again recovered strongly from early losses to end the session down less than 0.3%, when we take into account weak US S&P500 futures throughout much of our day and Star Entertainment (SGR) plunging almost 23% on more regulatory scrutiny for the sector, we felt it was another solid performance by the local market. It may sound myopic on our part considering we’re still bullish risk assets at current levels but stocks are still absorbing bad news and to us it has the overall feel that too many players are now short, or underweight equities.
A softer start to the week although the market did fight back well from early morning lows to close down only ~20pts. US Futures were sold off around our open today and that dragged the ASX down ~70pts, however 11am saw the worst of it and we grinded +50pts higher for the remainder of the day. Energy the main winner again however Iron Ore was up ~5% in Asia and that supported the material sector.
The ASX200 along with most global equity indices have had the proverbial kitchen sink thrown at them over recent weeks, if I was a “Bear” I would be extremely disappointed with the impact on equities to-date e.g. the ASX200 is only 4% below its all-time high while the US S&P500 has fared even better closing on Friday just 3.4% below its equivalent milestone. The following list of current market headwinds would have at sent all but the most resilient stock markets into official correction territory – a market correction is generally acknowledged to be 10%, or more. This morning’s snapshot list is…
The AX200 staged a solid recovery last week closing the shortened week, for some, up 1.87% with the Energy & Financial Sectors leading the line but with only the healthcare names closing in the red it was an encouraging solid broad-based effort. It still doesn’t feel like any “new money” is entering the market but with 3 of the “Big 4” banks due to trade ex-dividend in November we may see some buying in anticipation of the attractive payouts plus of course a large portion of these funds often returns to the market – the next few weeks is historically a very strong time for the sector which has a major positive influence on the local index.
A positive way to end the week for Aussie shares, supported by the US agreeing to extend the debt ceiling + China coming back online after a week long holiday and equities actually moving higher despite the barrage of negative rhetoric that’s been dribbling out of the Middle Kingdom of late. The Shanghai market up ~1% while Iron Ore rallied ~5% and other commodities did well, the bulk miners in Australia enjoying the change of trend.
