World Overnight | |||
SPI Overnight (Sep) | 6010.00 | – 52.00 | – 0.86% |
S&P ASX 200 | 6094.50 | + 19.40 | 0.32% |
S&P500 | 3235.66 | – 40.36 | – 1.23% |
Nasdaq Comp | 10461.42 | – 244.71 | – 2.29% |
DJIA | 26652.33 | – 353.51 | – 1.31% |
S&P500 VIX | 26.08 | + 1.76 | 7.24% |
US 10-year yield | 0.58 | – 0.01 | – 2.18% |
USD Index | 94.99 | – 0.18 | – 0.19% |
FTSE100 | 6211.44 | + 4.34 | 0.07% |
DAX30 | 13103.39 | – 0.86 | – 0.01% |
By Greg Peel
Still No Idea
For the record, yesterday’s rally marked the thirteenth day of non-consecutive moves for the ASX200, down-up-down-up, without stringing two days together in the same direction. Over that period the index has moved from 6014 to 6094.
The futures are showing down -52 this morning, which if accurate would provide for day fourteen and a total gain over the fortnight of 28 points or 0.5%.
Yesterday was mostly a nothing day. Volume was average and direction lacking. Sector moves suggested no themes.
The index traded all day in a plus/minus 25 point range. The high was reached just before Josh gave us the grim details, which set off a pullback, until someone pointed out the numbers were really no surprise. We’d certainly been well coached beforehand.
And they come with the caveat of “but let’s face it, you’ve got no idea and nor do we”.
On the one hand, the FY21 figure assumes Melbourne comes out of lockdown as planned at the end of six weeks – not looking likely – and on the other hand, the budget assumes a 2020 average iron ore price of US$55t – half of where it is now.
As Wayne Swan well knows, you can’t make any promises.
The best performing sector on the day was strangely consumer discretionary (+1.3%), with some help, strangely, from short-covering in Webjet ((WEB)), up 5.3%, and a 4.9% gain for Tabcorp Holdings ((TAH)) after CEO David Attenborough announced his retirement.
No I didn’t know he sidelined either, and he’s certainly getting on a bit.
Energy rose 1.2% helped by a well-received production report from Santos ((STO)), which gained 3.5%. Industrials rose 0.9% helped by a chart-topping 8.6% rise in NRW Holdings ((NWH)), which is another of those stocks that appears almost daily on either the winners or losers boards in recent times.
IT fell -0.5% despite the Nasdaq holding up overnight. Nearmap ((NEA)) was the worst index performer (-3.6%). Telcos fell -0.5% with TPG Telecom ((TPG)) continuing its post-merger slide (-2.4%).
All other sectors did little more than fanny about. The banks (+0.2%) now await next week’s dividend policy update from APRA. Staples fell -0.3% despite a 5.4% gain for Coca-Cola Amatil ((CCL)), which got some of its fizz back on the re-openings.
Remember them?
As noted, the futures are down -52 points this morning, due to profit-taking in five US stocks.
Out of my way!
Microsoft put the wheels in motion after the bell on Wednesday night by reporting a beat in both revenue and earnings and falling -4%. If Big Tech “beats” are going to be met by “sell the fact” – Microsoft being the first to report — then there’s no point waiting around to see what the others will do.
All of Microsoft, Facebook, Amazon, Google and Apple fell -3-5% last night, sending the Nasdaq down -3.3%, the S&P down -1.2% and the Dow (Apple, Microsoft) down -353 points.
Tesla fell -4%, despite having initially risen 4% in Wednesday night’s aftermarket post-result.
It was a clear case of profit-taking, and given these Big Techs are so dominant in their market caps, a clear case of rotation, given it could have been a lot worse index-wise. The Russell small cap index, which is usually the first to be jettisoned in any sign of bad news, closed flat.
There was indeed some bad news. US weekly new jobless claims rose by 1.42m last week, to mark the first weekly increase in fifteen. Economists had already been concerned that while the claims number had fallen steadily from initially high levels every week up to this point, it had never actually dropped into negative. Now it’s gone up again.
No great surprise given re-lockdowns.
Meanwhile, US-Sino tensions continue to ramp up, with Beijing yet to decide which US consulate it will close down in retaliation. Wuhan? Hong Kong?
And Demo-Repo tensions continue to smoulder as Congress tries to agree on another stimulus package, with the two sides seemingly still poles apart.
After the bell, Intel (Dow) reported earnings and beat on both the top and bottom lines. It’s down -10% in the aftermarket as I write.
Not shaping up as a great Friday night on Wall Street either.
Commodities
Spot Metals,Minerals & Energy Futures | |||
Gold (oz) | 1871.10 | + 29.70 | 1.61% |
Silver (oz) | 23.04 | + 1.72 | 8.07% |
Copper (lb) | 2.91 | – 0.04 | – 1.41% |
Aluminium (lb) | 0.75 | – 0.00 | – 0.25% |
Lead (lb) | 0.81 | – 0.01 | – 1.66% |
Nickel (lb) | 5.94 | – 0.05 | – 0.86% |
Zinc (lb) | 0.99 | – 0.00 | – 0.21% |
West Texas Crude | 41.89 | – 0.07 | – 0.17% |
Brent Crude | 44.30 | + 0.34 | 0.77% |
Iron Ore (t) futures | 111.20 | + 0.80 | 0.72% |
Latest numbers on dwindling inventories at the LME had copper moving up again last night, while Elon Musk put out a call to nickel miners that he’s going to need more for his batteries.
Some profit-taking was apparent in silver last night, but gold seems determined to return to its 2011 high above US$1900/oz, from which it then plummeted to US$1100/oz in 2016.
It appears Josh did manage to move the forex market. Despite another -0.2% fall for the greenback, the Aussie is down -0.6% at US$7096.
Today
The SPI Overnight closed down -52 points or -0.9%.
Today brings flash estimates of July manufacturing PMIs from across the globe.
The ABS will provide a preliminary read on June trade numbers.
The Australian share market over the past thirty days…
BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS | |||
BHP | BHP | Downgrade to Neutral from Buy | Citi |
Downgrade to Hold from Add | Morgans | ||
BLD | Boral | Downgrade to Lighten from Hold | Ord Minnett |
CSR | CSR | Upgrade to Accumulate from Hold | Ord Minnett |
DXS | Dexus Property | Downgrade to Neutral from Outperform | Macquarie |
HLO | Helloworld | Upgrade to Buy from Hold | Ord Minnett |
MFG | Magellan Financial Group | Downgrade to Underperform from Neutral | Macquarie |
NWL | Netwealth Group | Downgrade to Sell from Hold | Ord Minnett |
OZL | Oz Minerals | Downgrade to Hold from Add | Morgans |
PRU | Perseus Mining | Downgrade to Underperform from Neutral | Credit Suisse |
Downgrade to Underperform from Neutral | Macquarie | ||
QBE | QBE Insurance | Downgrade to Underperform from Neutral | Macquarie |
RSG | Resolute Mining | Upgrade to Outperform from Underperform | Macquarie |
SGP | Stockland | Upgrade to Neutral from Sell | Citi |
SGR | Star Entertainment | Upgrade to Equal-weight from Underweight | Morgan Stanley |
SLR | Silver Lake Resources | Upgrade to Outperform from Neutral | Macquarie |
WHC | Whitehaven Coal | Downgrade to Sell from Hold | Ord Minnett |