The ASX200 has closed up ~2% for the quarter even as we saw the RBA hike interest rates twice and the global banking sector teetering on the edge of a full-blown crisis. Equities continue to defy the numerous bears although it’s been far from one-way traffic so far in 2023 with the Energy & Financial Sectors falling while the interest rate sensitive names soared le by the Consumer Discretionary Index which soared +9.9%. An eclectic bunch of stocks caught our attention in both the winner’s and losers’ enclosure with M&A and reporting season exerting a huge influence on many stocks over the 3 months:
The ASX200 experienced a quiet week on the surface with the index closing down just 40 points / or -0.6% while under the hood there were some standout winners & losers but interestingly the much-discussed banking stocks were fairly quiet with the “Big 4” averaging a drop of just -1.5%. On a sector level, the banks and real estate names weighed on the index while on the stock front gold names again shone brightly while the ESG names (lithium) continued to struggle:
The ASX200 tumbled another 150 points last week taking this month’s decline to 3.6%, and a painful -7.6% from February’s high, just 6 weeks ago. The “Elephant In the Room” has certainly changed over the last fortnight as we’ve seen the US endure its 2nd & 3rd largest ever bank failures in history with another teeters on the edge, Europe has its own issues with Credit Swiss requiring a $US54bn lifeline to regain some degree of confidence in its futures - the financial system straining at the riskier edges.
The ASX200 plunged -166 points/2.28% on Friday resulting in a -1.9% decline for the week, not too bad considering the likes of BHP Group (BHP), RIO Tinto (RIO), and CSL Ltd (CSL) all traded ex-dividend but it certainly felt far worse at 4 pm yesterday afternoon. This week’s issue wasn’t the macroeconomic picture that’s plagued equities all year but another negative “Black Swan” shock from crypto land as silicon valley bank SVB Financial (SIVB US) struggles to remain in business – we’ve even heard suggestions of a US bailout from Walls Street legend Bill Ackman. Whatever the ultimate result it confirms our opinion that Bitcoin et al is not an investment-grade option until further notice.
The ASX200 slipped another -0.3% last week but in our opinion, it felt like a solid performance as equities shrugged off short-term bond yields continuing their unrelenting march to multi-month/year highs i.e. The Australian 3-year closed above 3.6% as they edged ever closer to fresh 20-year highs around 3.8% while the US 2-years did scale fresh 15 year highs above 4.9%. As we often say markets that don’t fall on “bad news” are strong:
The ASX200 slipped another -0.5% last week with a -4.3% drop by heavyweight BHP weighing on both the index and the Materials Sector, however, the market’s pullback has started to lose momentum as company earnings fail to deliver the disasters many had feared/expected. Reporting season remains the dominant factor on the stock level but it’s interesting that things aren’t panning out as would be expected on the sector level:
Friday’s tough day for equities took the ASX200 lower for a second consecutive week, almost 3% below its early February high. Reporting season has created some major volatility on the stock/sector level which is no surprise but its not common to see Commonwealth Bank (CBA) lead both the sector and index lower - Australia’s largest banks closed down -8.2% for the week with the average fall across the “Big Four” come Friday being -5.6%, remember MM often says “the market cannot go up with the banks”.
The ASX200 surrendered some of its 2023 gains last week finally closing down -1.65% with the 7400 support area suddenly the closest psychological level as the market appears to have simply run out of steam after surging +9.6% from its early January low. Last weeks weakness was broad based with all 11 sectors falling but the largest declines were in the interest rate sensitive real estate, IT and Healthcare stocks whereas the financials who often see improved margins/earnings through periods of rising interest rates were the best on ground, but they still slipped -0.35%. Central banks have again delivered the backdrop which has doused the markets recent mojo:
The ASX200 rallied another +65-points, or +0.9%, last week with most of the gains coming on Friday courtesy of the major banks, as most people know Commonwealth Bank (CBA) is now trading at an all-time high. However, while the index is clearly strong the story beneath the hood remains extremely mixed:
Winners: healthcare, tech, building and property e.g. CSL Ltd (CSL) +11.4%, SEEK (SEK) +9.8%, Xero (XRO) +8.9%, James Hardie (JHX) +9.5% and Goodman Group (GMG) +5.2%.
Losers: energy, insurance, resources e.g. Woodside Energy (WDS) -2.2%, IAG Insurance (IAG) -6.9%, IGO Ltd (IGO) -7.4% and BHP Group (BHP) -3.3%.
The ASX200 has now advanced +6.5% this month and we’ve still got two trading days remaining for January with Monday set to open back above 7500. The local Tech Sector led the gains last week rallying +2.8% supported by Real Estate +2.5% which was impressive considering that the local inflation data came in far worse than expected suggesting further rate hikes lay ahead but as we’ve alluded to previously news thats “not too bad” is now being embraced by the battered growth stocks. Under the hood the winners and losers circle was made up of 2 very different groups of companies:
The ASX200 experienced a quiet week on the surface with the index closing down just 40 points / or -0.6% while under the hood there were some standout winners & losers but interestingly the much-discussed banking stocks were fairly quiet with the “Big 4” averaging a drop of just -1.5%. On a sector level, the banks and real estate names weighed on the index while on the stock front gold names again shone brightly while the ESG names (lithium) continued to struggle:
The ASX200 tumbled another 150 points last week taking this month’s decline to 3.6%, and a painful -7.6% from February’s high, just 6 weeks ago. The “Elephant In the Room” has certainly changed over the last fortnight as we’ve seen the US endure its 2nd & 3rd largest ever bank failures in history with another teeters on the edge, Europe has its own issues with Credit Swiss requiring a $US54bn lifeline to regain some degree of confidence in its futures - the financial system straining at the riskier edges.
The ASX200 plunged -166 points/2.28% on Friday resulting in a -1.9% decline for the week, not too bad considering the likes of BHP Group (BHP), RIO Tinto (RIO), and CSL Ltd (CSL) all traded ex-dividend but it certainly felt far worse at 4 pm yesterday afternoon. This week’s issue wasn’t the macroeconomic picture that’s plagued equities all year but another negative “Black Swan” shock from crypto land as silicon valley bank SVB Financial (SIVB US) struggles to remain in business – we’ve even heard suggestions of a US bailout from Walls Street legend Bill Ackman. Whatever the ultimate result it confirms our opinion that Bitcoin et al is not an investment-grade option until further notice.
The ASX200 slipped another -0.3% last week but in our opinion, it felt like a solid performance as equities shrugged off short-term bond yields continuing their unrelenting march to multi-month/year highs i.e. The Australian 3-year closed above 3.6% as they edged ever closer to fresh 20-year highs around 3.8% while the US 2-years did scale fresh 15 year highs above 4.9%. As we often say markets that don’t fall on “bad news” are strong:
The ASX200 slipped another -0.5% last week with a -4.3% drop by heavyweight BHP weighing on both the index and the Materials Sector, however, the market’s pullback has started to lose momentum as company earnings fail to deliver the disasters many had feared/expected. Reporting season remains the dominant factor on the stock level but it’s interesting that things aren’t panning out as would be expected on the sector level:
Friday’s tough day for equities took the ASX200 lower for a second consecutive week, almost 3% below its early February high. Reporting season has created some major volatility on the stock/sector level which is no surprise but its not common to see Commonwealth Bank (CBA) lead both the sector and index lower - Australia’s largest banks closed down -8.2% for the week with the average fall across the “Big Four” come Friday being -5.6%, remember MM often says “the market cannot go up with the banks”.
The ASX200 surrendered some of its 2023 gains last week finally closing down -1.65% with the 7400 support area suddenly the closest psychological level as the market appears to have simply run out of steam after surging +9.6% from its early January low. Last weeks weakness was broad based with all 11 sectors falling but the largest declines were in the interest rate sensitive real estate, IT and Healthcare stocks whereas the financials who often see improved margins/earnings through periods of rising interest rates were the best on ground, but they still slipped -0.35%. Central banks have again delivered the backdrop which has doused the markets recent mojo:
The ASX200 rallied another +65-points, or +0.9%, last week with most of the gains coming on Friday courtesy of the major banks, as most people know Commonwealth Bank (CBA) is now trading at an all-time high. However, while the index is clearly strong the story beneath the hood remains extremely mixed:
Winners: healthcare, tech, building and property e.g. CSL Ltd (CSL) +11.4%, SEEK (SEK) +9.8%, Xero (XRO) +8.9%, James Hardie (JHX) +9.5% and Goodman Group (GMG) +5.2%.
Losers: energy, insurance, resources e.g. Woodside Energy (WDS) -2.2%, IAG Insurance (IAG) -6.9%, IGO Ltd (IGO) -7.4% and BHP Group (BHP) -3.3%.
The ASX200 has now advanced +6.5% this month and we’ve still got two trading days remaining for January with Monday set to open back above 7500. The local Tech Sector led the gains last week rallying +2.8% supported by Real Estate +2.5% which was impressive considering that the local inflation data came in far worse than expected suggesting further rate hikes lay ahead but as we’ve alluded to previously news thats “not too bad” is now being embraced by the battered growth stocks. Under the hood the winners and losers circle was made up of 2 very different groups of companies:
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