Viewpoint: Bullish
GMG has clawed back some of the bruising 42% decline endured through 2022, however, at this stage of the interest rate cycle MM is likely to reduce further our exposure if we see a rally into the $21 area.
The ASX200 rallied another +0.3% on Monday courtesy of China’s reopening shift which propelled resource stocks higher on hopes that the global economy can avoid a deep contraction in 2023, unfortunately, the move caused the market to polarise as bond yields rallied in line with the optimism towards the growth outlook. The move in bonds resulted in over half of the market closing lower but when the heavyweight resources advance strongly the market often ignores the crowd:
MTS +0.24%: Released 1H23 results this morning that were ahead of expectations led by Hardware & Food. They also pointed to a strong start to 2H23 so all seems to be rosy for MTS. Sales of $8.9bn was +7.8% y/y while underlying EBIT of $255.1m was +10.3% y/y, & around 6% ahead of market expectations. The 11.5cps dividend was also a beat. We own…
Golds rallied almost $US200/oz over recent weeks yet as the chart below illustrates investors are avoiding the precious metal with ETFs not seeing any discernible change in interest.
Crude oil has rejected the sub $US75 area and the combination of a declining $US and the weekend’s re-opening rhetoric from China should be supportive of oil, MM is now looking for some consolidation around the $US80/barrel area with the risks switching to the upside.
Gold and its associated stocks have soared higher over the last 5-weeks taking a bullish lead from the falling $US and global bond yields. The precious metal plunged 22% through 2022 as rising bond yields and an extremely strong $US removed the lustre from precious metals. This is yet another pocket of the market where bearish positioning…
The UK FTSE has been inundated with a deluge of bad news over the last 1-2 years but this week the index finds itself only 4.4% below its all-time high, a great advert for not reading the press! We often discuss the strong correlation between the ASX & FTSE, due to the indexes’ composition, and their almost exact approach to testing respective all-time highs is another perfect example.
Last week US equities popped to fresh 11-week highs following the dovish comments from Jerome Powell, we see further upside potential as yields and the $US slip lower with the influential tech sector poised to play some noticeable catch-up into Christmas.
The ASX200 pushed higher last week to levels not seen since early May and as we mentioned earlier a test of the market’s all-time high is now only a solid 1-2 days away.
Most people think 2022 has been an awful year for equities but performance has actually been very stock/sector-specific, it hasn’t been an annulus horribilis for broad market investors. The ASX200 will commence its run towards Christmas this morning down less than 2% with dividends for the average portfolio more than making up for the slight fall. Last week…
