Viewpoint: Bullish
Australian coal producers tumbled yesterday after Whitehaven’s (WHC) CEO Paul Flynn sold 900,000 shares and peer New Hope (NHC) delivered a trading update citing disruptive weather hindering coal supply, no good news there, the combination led to NHC -8.8% and WHC -6.7% being the main boards worst performing 2 stocks.
European stocks edged higher overnight as the ECB joined the chorus of central banks now talking about less aggressive interest rate hikes. They say central bankers make sheep look like independent thinkers and bar New Zealand, which is quite ironic, it seems to MM that there is a coordinated shift in the dialogue. The Australian 10 year bond yield is now 0.7% below it’s October peak.
REA finally caught our attention for the correct reasons yesterday as the stock gained +2.9%, taking it back within striking distance of its fresh 7-week highs. This is another stock that’s rotated sideways for many weeks and after shaking off a slightly weaker quarterly update 2-weeks ago, which came in around 4% below expectations, the stock looks/feels…
MM went long JHX in late October just before the building materials business downgraded its FY23 guidance by around 7%, another example of the vagaries of reporting season. However, the stock and sector appear to be slowly regaining their mojo after an annus horribilis and we still believe JHX has the right strategy to drive margin recovery…
The ASX200 edged higher yesterday finally closing up 10-points after surrendering 2/3 of the day’s gains in the late afternoon, while the winners and losers were evenly matched it was a very interesting story of three commodities on the stock/sector level:
We continue to like TCL for a defensive earnings stream backed by critical and irreplaceable infrastructure with a compound annual growth rate of ~8.5% over the next 5 years which actually benefits from inflation, it may have experienced a relatively quiet few years but we remain firm believers in this toll road operator.
TLS has experienced a relatively quiet 2022, a win compared to many stocks, we like the major telco as a defensive play due to its relatively insulated earnings and a sustainable dividend of around 4.3% fully franked. As the Australian telecommunications industry evolves TLS is a relatively conservative play but it is more expensive than some of…
US stocks rallied after the latest Fed minutes led by the NASDAQ 100 which closed up +0.5%, the S&P500 made fresh 10-week highs on the less hawkish minutes but after already bouncing +14% from its October low the upside momentum is muted for the broad index.
MQG has arrived back at its August high and basic resistance/average price of the last 12 months, considering the overall position of global equities plus of course the December factor our preferred scenario is we now see a break out towards $200 although it’s a move we will be more inclined to fade as opposed to chase.
