Viewpoint: Bullish
One of MM’s holdings in our International Portfolio unfortunately dropped the most since March after missing quarterly revenue expectations, another stock failing to accelerate to the upside after making fresh all-time highs – this current market characteristic feels like it’s here to stay in 2021 suggesting investors should be more active towards profit taking than they usually would.
Overnight saw another solid session for US stocks with the major indices hovering around their all-time highs and the Dow outperforming as the value stocks embraced the tepid GDP data. Our ideal target for this almost stately index remains ~36,000, or around 3% higher. Also disappointing jobs data lent some weight to the Feds recent…
If it doesn’t go down on bad news it must go up, or words to that effect and that’s what appears to be unfolding with Corportae Travel (CTD) a stock MM was considering at lower levels. Psychologically its extremely hard to chase CTD at current levels, up over 30% since May, but sometimes the hardest “trade” is the best one. We like CTD as a..
The ASX200 performed another 180 degree pirouette yesterday, one which was almost good enough for the Tokyo Games! The market continues to remind me of a washing machine spinning stocks and sectors in almost random direction with the underlying upside bias the only constant. The Tech stocks were best on ground…
PBH Trading Halt: The betting company was in a trading halt today raising ~$400m through Goldman Sach via an instituional placement at $10 with a combined entitlement offer allowing existing shareholders the ability to buy 1 new share for every 9 held at a price of $8.00. The money is to supercharge their US growth ambitions…
FMG +1.90%: posted FY21 and June quarter 21 production scorecard today and the numbers were very strong. They had record production of 182.2mt, up 2% on FY20 which was itself a record year up ~6% on FY19. Looking forward they have introduced FY22 guidance which is for FY22 shipments of between 180-185mt which is broadly inline with the 182.2mt in FY21.
FMG looks poised to make fresh highs helped by the moves in BHP & RIO overnight, from a risk / reward perspective we’re not excited by FMG which has ran way ahead of the underlying iron ore price but the trends up and we like the sector so this makes it more of a bullish hold in our opinion.
Following a strong session in the US, BHP is set to open at marginal fresh all-time highs this morning, around the $53.70 level. Our view hasn’t changed we’re targeting a test of the $60 area for BHP in the next 6-months plus of course it’s due to pay a healthy fully franked dividend in early September.
RIO rallied over +4.5% in the US overnight and locally the stock looks poised to challenge the $140 area in coming weeks. MM were hoping to buy RIO around $100 but as is so often happening at present pullbacks are falling short of our ideal entry levels illustrating the markets “buy the dip” mindset plus of course cash on the sidelines.
The Australian Dollar is often, along with copper, used as a gauge for future economic strength – over recent months the $A has fallen in-line with bond yields and economic confidence following the emergence of the delta strain.
