The ASX suffered a brutal session following US Indices lower to start the 2nd quarter of FY22. Infighting in the Democrats appear to threaten both infrastructure spending and an increase to the Government borrowing cap. We have seen all of this before, it’s political posturing that generally gets resolved however the infrastructure package is very important which is the curve ball in these negotiations.
The market ended a soft month of September with a bang today rallying ~1.9% with broad based buying right across the board and a very bullish close to finish on the daily and weekly highs, smashing back up through 7300 in the process.
Another weak session today saw the ASX end down more than 1% - the same culprits dragging the ASX lower, IT & Healthcare however Energy was also on the wrong side of the ledger today after a very strong run of late. As we discussed this morning, bond yields trading at 3 month highs is starting to unnerve investors while J Powell’s commentary around higher inflation further fueled that view.
Well, it seems there’s very little middle ground in the market at the moment with another ~100pt selloff coming on the back a few strong sessions – the 3 steps forward 2 back mentality we’ve been writing about in recent notes seems on point. Today it was weakness in the high value names, the growth areas of IT & Healthcare which really weighed the broader index which is a function of rising bond yields globally.
A bullish session for the ASX to kick off the last week of the month & quarter with the market enjoying the more concrete rhetoric around re-opening as laid out by Glady’s today. Unsurprisingly, travel stocks were strong however we also saw good gains from the Energy & Financial sectors at the expense of the Covid winners in IT & Healthcare. While the ASX200 finished +0.57% higher, the high was seen at midday and we tracked lower into the close – a big MOC order knocked the market ~20pts lower in the match.
The ASX fell today with real-estate the biggest drag as the IMF highlighted issues with our hot local property market - their expectation for another +20% gain this year is a bullish one + their rhetoric comes on the back of both ANZ and CBA flagging similar concerns. House prices are clearly hot, even boat prices are as well and everything in between as low rates and a lack of overseas travel fuels demand.
A strong day out for the index with gains in technology and energy leading the way while Healthcare and Materials were the main laggard, though still managing to eek out gains of ~0.2%. Talk out of Fed meetings in the US was the main topic on investors’ minds today while Evergrande took a back seat. The embattled Chinese developer saw shares rally 10% in Hong Kong today as Government support seems to be on its way.
The market was down early however news that China’s central bank boosted its daily liquidity injection plus confirmation that Evergrande had reached agreement with bondholders on a repayment due Sept. 23 got the buyers back out of hiatus and the market pushed higher.
While the market was sharply lower overnight there was no sign of panic in the selling, volatility stayed low, credit spreads hardly moved and equities saw a large reversal in the last 30mins of the session. That positive undertone became obvious in Oz today with the market seeing the worst of it early on, the ASX200 hit key support ~7200 before bouncing +80pts to finish up on the day – a very good effort really and a sign that underlying strength remains alive and well in this market.
The ASX was hit ~2% today on concerns largely stemming from China, firstly towards the rout in Iron Ore prices which were down another ~10% today in Singapore if we look at shorter dated contracts (more on this below) while the Evergrande fiasco is also making people nervous. Today (and over the weekend) the linkages to a Lehman Brothers type moment have been everywhere and that’s clearly created some nervousness.
The market ended a soft month of September with a bang today rallying ~1.9% with broad based buying right across the board and a very bullish close to finish on the daily and weekly highs, smashing back up through 7300 in the process.
Another weak session today saw the ASX end down more than 1% - the same culprits dragging the ASX lower, IT & Healthcare however Energy was also on the wrong side of the ledger today after a very strong run of late. As we discussed this morning, bond yields trading at 3 month highs is starting to unnerve investors while J Powell’s commentary around higher inflation further fueled that view.
Well, it seems there’s very little middle ground in the market at the moment with another ~100pt selloff coming on the back a few strong sessions – the 3 steps forward 2 back mentality we’ve been writing about in recent notes seems on point. Today it was weakness in the high value names, the growth areas of IT & Healthcare which really weighed the broader index which is a function of rising bond yields globally.
A bullish session for the ASX to kick off the last week of the month & quarter with the market enjoying the more concrete rhetoric around re-opening as laid out by Glady’s today. Unsurprisingly, travel stocks were strong however we also saw good gains from the Energy & Financial sectors at the expense of the Covid winners in IT & Healthcare. While the ASX200 finished +0.57% higher, the high was seen at midday and we tracked lower into the close – a big MOC order knocked the market ~20pts lower in the match.
The ASX fell today with real-estate the biggest drag as the IMF highlighted issues with our hot local property market - their expectation for another +20% gain this year is a bullish one + their rhetoric comes on the back of both ANZ and CBA flagging similar concerns. House prices are clearly hot, even boat prices are as well and everything in between as low rates and a lack of overseas travel fuels demand.
A strong day out for the index with gains in technology and energy leading the way while Healthcare and Materials were the main laggard, though still managing to eek out gains of ~0.2%. Talk out of Fed meetings in the US was the main topic on investors’ minds today while Evergrande took a back seat. The embattled Chinese developer saw shares rally 10% in Hong Kong today as Government support seems to be on its way.
The market was down early however news that China’s central bank boosted its daily liquidity injection plus confirmation that Evergrande had reached agreement with bondholders on a repayment due Sept. 23 got the buyers back out of hiatus and the market pushed higher.
While the market was sharply lower overnight there was no sign of panic in the selling, volatility stayed low, credit spreads hardly moved and equities saw a large reversal in the last 30mins of the session. That positive undertone became obvious in Oz today with the market seeing the worst of it early on, the ASX200 hit key support ~7200 before bouncing +80pts to finish up on the day – a very good effort really and a sign that underlying strength remains alive and well in this market.
The ASX was hit ~2% today on concerns largely stemming from China, firstly towards the rout in Iron Ore prices which were down another ~10% today in Singapore if we look at shorter dated contracts (more on this below) while the Evergrande fiasco is also making people nervous. Today (and over the weekend) the linkages to a Lehman Brothers type moment have been everywhere and that’s clearly created some nervousness.
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