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The Match Out: Stocks lower as Brisbane heads for longer lock down, AGL to split, TLS upgraded again
News that Brisbane is likely to go into a longer lockdown as the UK variant of the virus claims cases in the sunshine state has seen stocks sold off today as consistent selling from the open pushed the local market down nearly 100pts from the early session highs. A Byron Bay hens party seems to be the catalyst with the entertainment bringing more than was bargained for just as support from Job Keeper rolls off. Australia was a clear under performer from a regional perspective today as the material sector provided the biggest weight on the market overall.
Yesterday morning we saw Brisbane go into a snap 3-day lock down as fears the UK strain of COVID was about to explode through the capital of the Sunshine State, undoubtedly plenty of Easter holidays have been thrown into disarray by this one press conference.
The ASX lost ground today, selling off from early strength. The Brisbane lockdown kept the bulls at bay with rising case numbers coinciding with job keeper support rolling off.
Last week was again choppy although the ASX200 did finally manage to advance +1.7%, a better result than it felt watching my Bloomberg day to day.
No afternoon report today, keep an eye out for Q/A report tomorrow.
The rally by building stocks caught my attention yesterday in what was another fairly lacklustre session. The 4 local building stocks we are looking at today reside in the large Materials Sector which is illustrated below. At MM we had reduced our exposure to the influential Resources Sector.
Today’s Q&A note focuses largely on stocks that are underwater that MM holds across portfolios. Looking after / addressing the losers is very important when managing portfolios.
The best was seen in through the morning today with the market peaking over 6800 around lunch, only to give the bulk of it back into the close.
The ASX200 enjoyed a surprisingly strong Wednesday ignoring weakness in both the US and Asian Indices, although only just over half of the stocks rallied from an index perspective strength was at the right end of town with both Commonwealth Bank (CBA) and CSL Ltd (CSL) up by almost 2%. Weakness was again focused in the recovery and European facing stocks as the COVID situation deteriorates in many parts of the world, whenever I type words like this I think how lucky we’ve been in Australia.
The magnet at 6800 continues to attract the ASX today with early weakness bought into with particular focus on Healthcare and consumer names. The market closed ~20pts off its highs but still managed a 0.5% gain. Of particular note was the variation in performance across some of the banking names – CBA stood out with a gain of more than 1% while WBC was off 0.98% today.
