The ASX200 came under renewed pressure on Monday only from a different sector this time as the miners were smacked in line with their underlying commodities e.g. iron ore plunged 11% at one stage yesterday taking Fortescue Metals (FMG) down -8.6% in sympathy. Over 55% of the main board’s stocks rallied over the day but when the heavyweight resource stocks fall ~5% it’s always going to be tough going for the broad market. It feels like different market pockets/sectors are taking it in turns to attract sellers’ attention almost like dominos falling one at a time:
Global stocks have been smacked in 2022 with losses accelerating over the last few weeks primarily in our opinion because investors have simply lost confidence that central banks can / will balance inflation with economic growth, let’s just consider the RBA and some factors close to home:
The ASX200 struggled again on Thursday as it failed to embrace the bounce by overseas bourses following the 0.75% interest rate hike by the Fed, or maybe it was simply smarter expecting the recent equities downtrend to continue over the coming weeks – it would appear so this morning! Overall the session was another lacklustre performance which may have seen the winners and losers evenly matched but when the banks struggle the local index tends to follow suit, Westpac (WBC) for example has now tumbled -20% in just 2-weeks.
The ASX200 endured another bad day at the office on Wednesday with the index closing down a further -1.3% after flouting with positive territory at lunchtime. Yesterday’s fall was on a distinct lack of buying as opposed to aggressive selling - investors remaining very nervous, a pretty understandable mindset considering the press, both financial and mainstream e.g. yesterday saw Jarden’s suggest local house prices are set for their worst fall in over 40-years. The prospect of the Fed hiking interest rates by more than expected this morning felt like it was enough to send buyers searching for cover as cash feels the comfortable option for many at the moment, ironically a relatively poor performing...
The ASX200 was hammered another -3.6% yesterday with well over 90% of the main board closing in the red, we may have bounced from support below 6600 but the market clearly remains very nervous. Recent weeks have certainly reinforced the old saying “sell in May & go away”, probably more effectively than all but the most pessimistic bears were expecting. During periods of uncertainty and volatility its important to maintain a degree of perspective even if feel like running for the hills, a move that history tells us is not a prudent course of action for long-term investors.
Global stocks have experienced ever-increasing volatility through 2022 and while its easy to point the finger of blame directly at surging bond yields we believe the removal of liquidity is more specifically the issue although by definition they go hand in hand. What matters is where to from here so MM and our subscribers can add value (alpha) to our portfolios while both fear and opportunity increase by the week. The obvious place to start our search for answers is by reviewing the previous occasions when the Fed removed QE and its subsequent impact on stocks.
The ASX200 was smacked for the 2nd day this week as UBS’s more cautious rhetoric towards the banks continued to drive the influential sector lower e.g. Commonwealth Bank (CBA) -2.6% and Westpac (WBC) -3.7%. I can feel the questions brewing up for the weekend report “is it time to buy the banks?”, firstly lets simply revert to the seasonal statistics as the financials dance to their common June tune:
The ASX200 put in an average performance yesterday after a promising start as it attempted to recoup some of Tuesday’s plunge following the RBAs aggressive rate hike, we finally closed up 25-points after the index surrendered over half of its early gains as the banks took one of their biggest hits in a long time e.g. Westpac (WBC) -6.1% and Commonwealth Bank (CBA) -4.4%. MM had highlighted earlier in the month that the banks usually struggle through June but even we were surprised by the severity of their decline – we cited this seasonal weakness looming on the horizon as a headwind for the ASX over the coming weeks...
The ASX200 was thumped -1.5% yesterday after the RBA pressed hard on the jugular of the Australian economy, its 0.5% rate hike to 0.85% was the largest in over 20-years with more rate increases promised into 2023, the futures market is now pricing in a Cash Rate of 3.1% come December.
The ASX200 commenced the week on the back foot falling -0.45%, erasing the month of Junes small gain in the process, the selling was light but fairly broad-based with less than 20% of the main board managing to rally on Monday. With both the US & UK after-market Futures rallying strongly throughout the day AEST it felt like the local market was being held hostage by the RBA’s interest rate decision at 2.30 pm today – there are mixed opinions as to how far Philip Lowe will go with the interest rate markets pricing in a 0.28% rate hike and for the cash rate to reach 2.9% by the end of 2022. Markets hate uncertainty hence if overseas markets remain well supported...
Global stocks have been smacked in 2022 with losses accelerating over the last few weeks primarily in our opinion because investors have simply lost confidence that central banks can / will balance inflation with economic growth, let’s just consider the RBA and some factors close to home:
The ASX200 struggled again on Thursday as it failed to embrace the bounce by overseas bourses following the 0.75% interest rate hike by the Fed, or maybe it was simply smarter expecting the recent equities downtrend to continue over the coming weeks – it would appear so this morning! Overall the session was another lacklustre performance which may have seen the winners and losers evenly matched but when the banks struggle the local index tends to follow suit, Westpac (WBC) for example has now tumbled -20% in just 2-weeks.
The ASX200 endured another bad day at the office on Wednesday with the index closing down a further -1.3% after flouting with positive territory at lunchtime. Yesterday’s fall was on a distinct lack of buying as opposed to aggressive selling - investors remaining very nervous, a pretty understandable mindset considering the press, both financial and mainstream e.g. yesterday saw Jarden’s suggest local house prices are set for their worst fall in over 40-years. The prospect of the Fed hiking interest rates by more than expected this morning felt like it was enough to send buyers searching for cover as cash feels the comfortable option for many at the moment, ironically a relatively poor performing...
The ASX200 was hammered another -3.6% yesterday with well over 90% of the main board closing in the red, we may have bounced from support below 6600 but the market clearly remains very nervous. Recent weeks have certainly reinforced the old saying “sell in May & go away”, probably more effectively than all but the most pessimistic bears were expecting. During periods of uncertainty and volatility its important to maintain a degree of perspective even if feel like running for the hills, a move that history tells us is not a prudent course of action for long-term investors.
Global stocks have experienced ever-increasing volatility through 2022 and while its easy to point the finger of blame directly at surging bond yields we believe the removal of liquidity is more specifically the issue although by definition they go hand in hand. What matters is where to from here so MM and our subscribers can add value (alpha) to our portfolios while both fear and opportunity increase by the week. The obvious place to start our search for answers is by reviewing the previous occasions when the Fed removed QE and its subsequent impact on stocks.
The ASX200 was smacked for the 2nd day this week as UBS’s more cautious rhetoric towards the banks continued to drive the influential sector lower e.g. Commonwealth Bank (CBA) -2.6% and Westpac (WBC) -3.7%. I can feel the questions brewing up for the weekend report “is it time to buy the banks?”, firstly lets simply revert to the seasonal statistics as the financials dance to their common June tune:
The ASX200 put in an average performance yesterday after a promising start as it attempted to recoup some of Tuesday’s plunge following the RBAs aggressive rate hike, we finally closed up 25-points after the index surrendered over half of its early gains as the banks took one of their biggest hits in a long time e.g. Westpac (WBC) -6.1% and Commonwealth Bank (CBA) -4.4%. MM had highlighted earlier in the month that the banks usually struggle through June but even we were surprised by the severity of their decline – we cited this seasonal weakness looming on the horizon as a headwind for the ASX over the coming weeks...
The ASX200 was thumped -1.5% yesterday after the RBA pressed hard on the jugular of the Australian economy, its 0.5% rate hike to 0.85% was the largest in over 20-years with more rate increases promised into 2023, the futures market is now pricing in a Cash Rate of 3.1% come December.
The ASX200 commenced the week on the back foot falling -0.45%, erasing the month of Junes small gain in the process, the selling was light but fairly broad-based with less than 20% of the main board managing to rally on Monday. With both the US & UK after-market Futures rallying strongly throughout the day AEST it felt like the local market was being held hostage by the RBA’s interest rate decision at 2.30 pm today – there are mixed opinions as to how far Philip Lowe will go with the interest rate markets pricing in a 0.28% rate hike and for the cash rate to reach 2.9% by the end of 2022. Markets hate uncertainty hence if overseas markets remain well supported...
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