The ASX200 closed down -0.9% on Friday but it still managed to end a choppy week up +1.6% courtesy of broad-based gains led by the Gold, Real Estate, Utilities, and Industrial Sectors, a pretty good performance in our opinion taking into account some poor stock specific news from both home and abroad, Chinas increased unfriendly market policies plus of course the uncertainty around the looming rate decisions from both the RBA & Fed.
The ASX200 ended its penultimate week of October down -1.2% with the damage unfolding over the last 2-days hence going into the weekend the market actually felt far worse, however, the market remains up over 200-points for the month – it certainly doesn’t feel like it! Yet again the Energy Sector was best on the ground while the Utilities Sector carried the wooden spoon. We can see the local index remaining in the 6600 - 6800 trading range into next month although we still believe the risks are on the upside.
The ASX200 closed out the 2nd week of October with a strong +1.75% rally, even after Thursdays US inflation data came in higher than expected, after struggling for most of the week the local index finally ended down just 4-points and impressively up almost 300-points halfway into the infamous month. MM has been repeating our view over recent weeks but the last 24-hours illustrated the point perfectly as we await the latest Bank of Americas Fund Managers Survey we know that this time last month investors cash levels sat at 6.1%, up from 5.7% in August and well above the long term average of just 4.8%.
The ASX200 finally enjoyed a strong week even after surrendering -0.8% on Friday, the local index still rounded out the 1st 5-days of October up +5.5%. I know it’s very early days but the bears shouldn’t dismiss the seasonal strength stocks have enjoyed through Q4 over the last 20-years especially when we consider the weakness through the first 9-months of the year. Last weeks main catalyst for strength in local stocks came from the RBA although US stocks gave a helping hand early on:
The ASX200 tumbled into the close on Friday ending September on the same note as most of the last 6-weeks, the greater than 500-point monthly decline has been primarily instigated by rhetoric from the Fed who turned very hawkish at the end of August following the Jackson Hole economic symposium, and ongoing comments from the board have maintained the pressure on risk assets ever since. Investors started last month focusing on rising interest rates before later worries also started to encompass fears around a recession into 2023, and specifically how deep/long will it be.
The ASX200 tumbled into the Feds FOMC meeting on Wednesday only to compound the losses throughout an awful session on Friday which ultimately resulted in the local market falling over -2.4% for the week, with all 11-sectors closing lower led by the interest rate sensitive Tech, Utilities, Real Estate and Consumer Discretionary Sectors - all of which fell around 5%, or more. The Fed and Bank of England combined forces to dash market hopes that interest rates were approaching their peak, if anything the fight against inflation has been ramped up:
The Fed hiked rates by 0.75% and the BOE by an aggressive 0.5%, which poses the question what next from the RBA in 2-weeks’ time?
The big shake up from the Fed was delivered by its rhetoric - Jerome Powell said that a “soft landing for the US economy will be very difficult to achieve” i.e. buckle up for a recession.
The last 3-days saw the ASX200 take a 270-point / 3.9% hammering as it followed global equities sharply lower after the US CPI inflation numbers came in well ahead of expectations dashing the markets increasing hopes that the Fed will ease off any time soon from its aggressive hiking path.
The ASX200 went on a rollercoaster ride last week with major swings in both directions as volatility reigned supreme, we saw a clear week of 2 halves with a strong rally on Friday ultimately resulting in a +1% gain for the index over the 5-days - a very impressive outcome considering where stocks finished up on Wednesday. In typical fashion post Covid it was central banks which drove the significant swings in market sentiment across stocks, bond yields, FX and commodity prices.
The ASX200 was clobbered last week firstly by last Fridays extremely hawkish statement from Jerome Powell out of Jackson Hole, which sent US 2-year bond yields to 15-year highs, plus the news’s later in the week that China had locked down a city of 21 million people following an outbreak of just 1,000 Covid cases – NSW had 4,169 reported cases yesterday and we’re now even allowing internal flights without masks! Resource stocks were some of the worst hit over the week, especially in the last few days, as iron ore hit a 10-month low and copper looks destined to test its 2-year low:
The ASX200 closed down -0.9% on Friday but it still managed to end a choppy week up +1.6% courtesy of broad-based gains led by the Gold, Real Estate, Utilities, and Industrial Sectors, a pretty good performance in our opinion taking into account some poor stock specific news from both home and abroad, Chinas increased unfriendly market policies plus of course the uncertainty around the looming rate decisions from both the RBA & Fed.
The ASX200 ended its penultimate week of October down -1.2% with the damage unfolding over the last 2-days hence going into the weekend the market actually felt far worse, however, the market remains up over 200-points for the month – it certainly doesn’t feel like it! Yet again the Energy Sector was best on the ground while the Utilities Sector carried the wooden spoon. We can see the local index remaining in the 6600 - 6800 trading range into next month although we still believe the risks are on the upside.
The ASX200 closed out the 2nd week of October with a strong +1.75% rally, even after Thursdays US inflation data came in higher than expected, after struggling for most of the week the local index finally ended down just 4-points and impressively up almost 300-points halfway into the infamous month. MM has been repeating our view over recent weeks but the last 24-hours illustrated the point perfectly as we await the latest Bank of Americas Fund Managers Survey we know that this time last month investors cash levels sat at 6.1%, up from 5.7% in August and well above the long term average of just 4.8%.
The ASX200 finally enjoyed a strong week even after surrendering -0.8% on Friday, the local index still rounded out the 1st 5-days of October up +5.5%. I know it’s very early days but the bears shouldn’t dismiss the seasonal strength stocks have enjoyed through Q4 over the last 20-years especially when we consider the weakness through the first 9-months of the year. Last weeks main catalyst for strength in local stocks came from the RBA although US stocks gave a helping hand early on:
The ASX200 tumbled into the close on Friday ending September on the same note as most of the last 6-weeks, the greater than 500-point monthly decline has been primarily instigated by rhetoric from the Fed who turned very hawkish at the end of August following the Jackson Hole economic symposium, and ongoing comments from the board have maintained the pressure on risk assets ever since. Investors started last month focusing on rising interest rates before later worries also started to encompass fears around a recession into 2023, and specifically how deep/long will it be.
The ASX200 tumbled into the Feds FOMC meeting on Wednesday only to compound the losses throughout an awful session on Friday which ultimately resulted in the local market falling over -2.4% for the week, with all 11-sectors closing lower led by the interest rate sensitive Tech, Utilities, Real Estate and Consumer Discretionary Sectors - all of which fell around 5%, or more. The Fed and Bank of England combined forces to dash market hopes that interest rates were approaching their peak, if anything the fight against inflation has been ramped up:
The Fed hiked rates by 0.75% and the BOE by an aggressive 0.5%, which poses the question what next from the RBA in 2-weeks’ time?
The big shake up from the Fed was delivered by its rhetoric - Jerome Powell said that a “soft landing for the US economy will be very difficult to achieve” i.e. buckle up for a recession.
The last 3-days saw the ASX200 take a 270-point / 3.9% hammering as it followed global equities sharply lower after the US CPI inflation numbers came in well ahead of expectations dashing the markets increasing hopes that the Fed will ease off any time soon from its aggressive hiking path.
The ASX200 went on a rollercoaster ride last week with major swings in both directions as volatility reigned supreme, we saw a clear week of 2 halves with a strong rally on Friday ultimately resulting in a +1% gain for the index over the 5-days - a very impressive outcome considering where stocks finished up on Wednesday. In typical fashion post Covid it was central banks which drove the significant swings in market sentiment across stocks, bond yields, FX and commodity prices.
The ASX200 was clobbered last week firstly by last Fridays extremely hawkish statement from Jerome Powell out of Jackson Hole, which sent US 2-year bond yields to 15-year highs, plus the news’s later in the week that China had locked down a city of 21 million people following an outbreak of just 1,000 Covid cases – NSW had 4,169 reported cases yesterday and we’re now even allowing internal flights without masks! Resource stocks were some of the worst hit over the week, especially in the last few days, as iron ore hit a 10-month low and copper looks destined to test its 2-year low:
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