Viewpoint: Bullish
Consumer discretionary stocks have been sold off right across the board on the expectation that a recession will curtail discretionary spending, however, as highlighted in recent reports we think there is value emerging in some areas, one of those being the low-cost jewellery business, Lovisa (LOV). LOV is in a strong position, looking to double earnings over the coming 12-months through…
The ASX200 finally managed to close with a small gain on Tuesday and it currently appears that we will need a reasonable reporting season out of the US to help propel the ASX up ~4% towards our short-term target area, hopefully, investors have become too bearish into this week’s US inflation report.
The broad based S&P500 fell over 1% last night on concerns around Covid numbers and the looming US reporting season. In simple language we’ve seen a reasonable bounce from the panic June sell-off but for this move to gain further traction investors are going to need some good old fashioned solid fundamental news which hasn’t been overly forthcoming through most of 2022.
The ASX200 fell over 1% yesterday as increasing Covid cases across the globe started to weigh on an already fragile market – it already feels like ages ago that everybody was trying to buy into the re-opening trade! Over 80% of stocks on the main board fell on Monday but although there was broad based weakness it was on relatively low volume suggesting buyers simply took a step backwards as opposed to the sellers…
European indices have struggled through 2022 with a war raging on their doorstep leading to a painful and worsening domestic energy crisis. The French CAC has already corrected -22% from its January high, while we have no bullish catalyst the index continues to hold its long-term support ~6,000 suggesting a bounce is a strong possibility.
The main US indices recovered strongly from an early sell-off on Friday night following the solid jobs report which echoed loudly and clearly that we’re not in a recession just yet.
The ASX200 looks set to open around the psychological 6700 area this morning as it slowly approaches its high of the last 2-weeks, if we are correct this will be breached this month and the index will rally towards the 6850-6900 area:
While MM likes the “Millionaires Factory “ as it’s so colloquially referred to in many circles but our 7% position feels a touch rich in today’s risk-off environment, we have been evaluating whether to trim back our exposure over the coming weeks. MM has been considering taking profit / reducing our fairly large MQG position around the $180 area.
The UK Conservative Party is looking for a new leader after knifing Boris only a couple of years after he delivered a landslide victory, politics can be really be a ruthless arena – the same result didn’t appear likely in the next election due before January 2025. As for UK equities they’ve been impressively resolute over the last 18-months only correcting -11.7% at their worst, significantly outperforming…
US stocks rallied again overnight with tech & energy names the standout in a solid session for the indices, we saw the higher beta names gain noticeable traction as “risk on” was clearly flavour of the day e.g. Tesla (TSLA US) +5.5%, Netflix (NFLX US) +2.8% and Spotify (SPOT US) +2.9%.
