Weak GDP sees Aussie Dollar back below 80c
A very busy day on the desk after some big moves in the US market overnight with equities sold and bonds bought (pushing down yields) after the yanks came back online from the Labour Day Holiday. Nth Korea continues to bubble away with tensions between the Swiss educated dictator and the rest of the world edging closer to some sort of ‘end game’ with Russian President Vladimir Putin articulating the issues fairly succinctly by concluding that North Koreans would rather "eat grass" than suspend their nuclear weapons program– doesn’t really warm the heart!
The overnight trends played heavily into flows today with banks and insurers suffering from lower US bond yields overnight courtesy of some safe haven buying + we also had two more dovish Fed members suggest there was no great rush for the US Central Bank to raise interest rates…rates lower for longer is an obvious impediment to some areas of the market.
That thinking was also obvious here is Australia today after the latest GDP numbers came in below expectations – printing +0.8% QoQ versus the market estimate of +0.9% suggesting an annual rate of +1.8% versus the +1.9% forecast. The Aussie Dollar was weaker on the news and traded back down through 80c.
Aussie Dollar Daily Chart
We took profits on one holding today, and up weighted on another that we’ll cover in more detail tomorrow morning, however our overall cash balance now sits at 11% in the Growth Portfolio - clearly thinking that we’ll get a better opportunity to spend it in the weeks ahead.
On the broader market today, the Energy sector led the way while most weakness was felt in the Financials which lost -1.19% - an overall range of +/- 43 points, a high of 5706, a low of 5662 and a close of 5689, off -16pts or -0.29%.
ASX 200 Intra-Day Chart
ASX 200 Daily Chart
Have a great night
The Market Matters Team
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