The ASX200 tumbled another 105-points yesterday closing less than 1% above this year’s low posted back in June, Monday’s selling was specifically focused in the Energy & Resources Sectors e.g. Whitehaven Coal (WHC) -14%, Woodside Energy (WDS) -5%, IGO Ltd (IGO) -7.6%, South32 (S32) -7% and BHP Group (BHP) -5.2%. Interestingly the market’s weakness wasn’t very broad-based for such a disappointing session with over 25% of stocks and 45% of sectors managing to close in positive territory – more on the divergence later.
Equities are experiencing a September to forget and although most indices haven’t yet broken below their June lows things are “feeling” worse this time around e.g. the S&P500 closed on Friday 1.6% above its mid-year low but the Dow ended the week at fresh lows for 2022. There was no really good news on either the macro-economic or geopolitical front but we feel it was a trifecta of semi-left-field news that sent stocks reeling e.g. the S&P500 tumbled -4.6% and while the ASX200 fared better only falling 2.4% it’s set to open down another -1.25% this morning. The problem for stocks came from 3 different continents which combined with rising interest rates created a major headwind for risk assets:
The Australian market was closed over the Feds FOMC meeting for a National Day of Mourning for Her Majesty The Queen, normally a 24-hour pause wouldn’t be noticed by stocks but this was no ordinary rate decision and accompanying minutes from the Fed:
The ASX200 recovered some recently lost ground on Tuesday enjoying broad-based buying but volumes were low, ultimately we saw over 70% of the index close in positive territory. The selling felt a touch exhausted yesterday following the recent aggressive downturn but there may be more bad news waiting in the wings before the weekend arrives:
The ASX200 drifted lower yesterday on apparent nervousness ahead of this week’s US rates decision as economists weighed the prospect of a 0.75% move, or potentially a sledgehammer-style 1% rate hike – only a few months ago the idea of a 0.5% hike was foreign to investors now many believe it could be twice that amount! Markets are developing that self-fulfilling quiet before the storm feel about them before Wednesday’s decision, we’re still looking for buying opportunities but at the moment the path of least resistance remains on the downside.
Stocks endured a very tough 2nd half to last week following a strong US CPI number which caught most economists on the wrong foot, again – consensus was for inflation to have fallen by -0.1% in August but in fact, it rose by yet another +0.1%. We feel the biggest problem for equities last week wasn’t so much the unexpected positive inflation print but the aggressive optimism fuelled rally that preceded the number:
The ASX200 managed to reclaim a little lost ground yesterday but the bounce was very unconvincing with almost 60% of the main board closing in negative territory – fortunately, the influential banks enjoyed a solid day which offset the more broad-based losses. Elsewhere the Energy Sector continued to defy gravity rallying another +3.7% with all 10 stocks closing up on the day, an impressive performance considering crude oil is still languishing ~25% below its June high.
The ASX200 was clobbered over -2.5% yesterday wiping over $60bn from the local index following steep losses on Wall Street after Tuesday’s US CPI demonstrated that inflation remains stubbornly high. Waking up to a 1300-point rout on Wall Street is enough to scare any investor but we should consider the previous few sessions before throwing the baby out with the proverbial bathwater:
The last 4 sessions have seen the ASX200 recover strongly from last week’s early sell-off impressively taking the index back into positive territory for September – to be exact it rallied 4.4% from last Wednesday’s low as investors appeared to “square up” ahead of the overnight US inflation data. Tuesday’s advance was again broad-based with over 80% of stocks closing up on the day led by the Real Estate Sector for a change but it was again the lack of meaningful selling which saw the main benchmark close above 7000. This lack of selling came as no surprise to MM although the rally was stronger than we expected courtesy of a positive lead from the US equities:
The ASX200 has enjoyed a strong start to the week with yesterday’s +1% taking the index back to almost unchanged for September following the major jitters early last week – in today’s market a week is clearly a long time! Buying was broad-based on Monday with well over 70% of stocks advancing led as was expected by the Resources Sector e.g. Sandfire Resources (SFR) +3.6% BHP Group (BHP) +3.5% and Fortescue Metals (FMG) +3.3%. There was some very interesting news out of Ukraine over the last 24 hours which the market seemed to largely ignore probably because it can be interpreted in a number of different ways:
Equities are experiencing a September to forget and although most indices haven’t yet broken below their June lows things are “feeling” worse this time around e.g. the S&P500 closed on Friday 1.6% above its mid-year low but the Dow ended the week at fresh lows for 2022. There was no really good news on either the macro-economic or geopolitical front but we feel it was a trifecta of semi-left-field news that sent stocks reeling e.g. the S&P500 tumbled -4.6% and while the ASX200 fared better only falling 2.4% it’s set to open down another -1.25% this morning. The problem for stocks came from 3 different continents which combined with rising interest rates created a major headwind for risk assets:
The Australian market was closed over the Feds FOMC meeting for a National Day of Mourning for Her Majesty The Queen, normally a 24-hour pause wouldn’t be noticed by stocks but this was no ordinary rate decision and accompanying minutes from the Fed:
The ASX200 recovered some recently lost ground on Tuesday enjoying broad-based buying but volumes were low, ultimately we saw over 70% of the index close in positive territory. The selling felt a touch exhausted yesterday following the recent aggressive downturn but there may be more bad news waiting in the wings before the weekend arrives:
The ASX200 drifted lower yesterday on apparent nervousness ahead of this week’s US rates decision as economists weighed the prospect of a 0.75% move, or potentially a sledgehammer-style 1% rate hike – only a few months ago the idea of a 0.5% hike was foreign to investors now many believe it could be twice that amount! Markets are developing that self-fulfilling quiet before the storm feel about them before Wednesday’s decision, we’re still looking for buying opportunities but at the moment the path of least resistance remains on the downside.
Stocks endured a very tough 2nd half to last week following a strong US CPI number which caught most economists on the wrong foot, again – consensus was for inflation to have fallen by -0.1% in August but in fact, it rose by yet another +0.1%. We feel the biggest problem for equities last week wasn’t so much the unexpected positive inflation print but the aggressive optimism fuelled rally that preceded the number:
The ASX200 managed to reclaim a little lost ground yesterday but the bounce was very unconvincing with almost 60% of the main board closing in negative territory – fortunately, the influential banks enjoyed a solid day which offset the more broad-based losses. Elsewhere the Energy Sector continued to defy gravity rallying another +3.7% with all 10 stocks closing up on the day, an impressive performance considering crude oil is still languishing ~25% below its June high.
The ASX200 was clobbered over -2.5% yesterday wiping over $60bn from the local index following steep losses on Wall Street after Tuesday’s US CPI demonstrated that inflation remains stubbornly high. Waking up to a 1300-point rout on Wall Street is enough to scare any investor but we should consider the previous few sessions before throwing the baby out with the proverbial bathwater:
The last 4 sessions have seen the ASX200 recover strongly from last week’s early sell-off impressively taking the index back into positive territory for September – to be exact it rallied 4.4% from last Wednesday’s low as investors appeared to “square up” ahead of the overnight US inflation data. Tuesday’s advance was again broad-based with over 80% of stocks closing up on the day led by the Real Estate Sector for a change but it was again the lack of meaningful selling which saw the main benchmark close above 7000. This lack of selling came as no surprise to MM although the rally was stronger than we expected courtesy of a positive lead from the US equities:
The ASX200 has enjoyed a strong start to the week with yesterday’s +1% taking the index back to almost unchanged for September following the major jitters early last week – in today’s market a week is clearly a long time! Buying was broad-based on Monday with well over 70% of stocks advancing led as was expected by the Resources Sector e.g. Sandfire Resources (SFR) +3.6% BHP Group (BHP) +3.5% and Fortescue Metals (FMG) +3.3%. There was some very interesting news out of Ukraine over the last 24 hours which the market seemed to largely ignore probably because it can be interpreted in a number of different ways:
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