ASX at the close

Chris Weston, Chief Market Strategist at IG Markets Equity bulls will be sad to see the end of the first quarter, with some outrageous gains in global markets, especially with the right hedging policy. The big consensus trades have been long Europe, Japan and China, while underweight US stocks exposed to a stronger USD. Short

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Brazilian woes weighing on Australia

From the FT: …the Brazilian real, which has depreciated almost 20 per cent against the US dollar since the start of the year, falling to an 11-year low…The real’s weakness is being felt by Brazilian farmers who have increased exports, as returns on dollar-denominated commodities rise in in local currency terms. …In the coffee market,


Australian household debt ratios hit record

By Leith van Onselen The Reserve Bank of Australia (RBA) today updated its quarterly financial statistics, which revealed that Australian household debt rose to an all-time high in the December quarter of 2014. The ratio of mortgage debt-to-disposable income hit a record 140.3% in December, up from June 2010 peak of 134.7% (see next chart).


Bill Evans: RBA to cut in April

More sudden consensus from Bill Evans: Since the March meeting we have argued that the cash rate is certain to be eased by 0.25% in the April/May “window” while retaining an “April bias”(analysis of RBA’s rate decision following the March meeting.) We are sticking with that April view while recognising that the Bank could easily


Housing credit tops-out in February

By Leith van Onselen The Reserve Bank of Australia (RBA) today released its private sector credit aggregates data for the month of February: A chart showing the long-run breakdown in the components is provided below: Personal credit growth (-0.3% MoM; -0.5% QoQ; 0.5% YoY) remains in the gutter, whereas business credit growth (0.6% MoM; 1.9%


Units blowoff outweighs fading new house sales

From the HIA comes February new home sales In February 2015 total seasonally adjusted new home sales increased by 1.1 per cent, following the previous month’s rise of 1.8 per cent. This development brings overall sales to a new cyclical high. New home sales in February just exceeded the previous peak in April 2014 – by


ACCI: Too easy for wealthy to avoid tax

By Leith van Onselen The CEO of the Australian Chamber of Commerce and Industry (ACCI), Kate Carnell, appeared on ABC’s Lateline last night, where she admitted that it is too easy for wealthy Australians to avoid paying tax due to Australia’s overly generous superannuation concessions and negative gearing: EMMA ALBERICI: Kate Carnell, negative gearing, superannuation


Consumer confidence stuck at low altitude

By Leith van Onselen The ANZ-Roy Morgan Research (RMR) consumer confidence index has risen slightly once again, rising 0.9 points to 112.3 in the week ended 29 March to be tracking just below the long-run average of 113 (see next chart). According to ANZ, household’s view of the economic outlook is improving, which drove the


Mac Bank: We’re building but they’re not coming

From Mac Bank: For year’s Australia’s net migration data shows that people have come, but building approvals – and housing affordability – demonstrate that we’ve underbuilt. Now the opposite looks to be occurring. At a time when residential construction activity looks to finally be picking up, the pace of population growth is in decline – thanks to falling net


Macro Morning: Running of the bulls

By Chris Becker The confidence fairy spread the pixie dust across risk markets last night as talk of stimulus in China outweighed real economy news like lower earnings for S&P500 companies, lower US consumer spending amid higher home sales. Mergers and buybacks also helped the S&P500 rise more than 1% while European stocks were helped


Finally, super concession rort in the gun

By Leith van Onselen Reform to Australia’s inequitable and unsustainable superannuation concessions looks like a real possibility, with all major parties now backing reform. According to The AFR, Labor Treasury Spokesman, Chris Bowen, said there would be bipartisan support to reform the superannuation regime, which he claims is in need of “improvement”: “Where you have


The rise and rise and RISE of Australian debt

Another splendid missive today from Alex Joiner of BofAML who is distinguishing himself as a more than sane foil to mainstream economic thinking in Australia. Republished with permission enjoy The rise and rise of Australian indebtedness or, as I like to call it, the dumbest bubble in history.   The release of the December quarter financial


An outbreak of Boomer crocodile tears

I guess the writing is on the wall. Following yesterday’s Alzheimer confessions by Ross Gittins and Robert Gottliebsen that we should be concerned about the sellout of Australian youth in mining and property, today we get The Pascometer covering his tracks with ladles of empathy. For Gittins is the failing mining boom that has so


FIRB whiners primer: How to recognise a “child”

From the AFR, home of realty rentier whining: Offshore investors have baulked at Australian property following the Foreign Investment Review Board’s inquiry into non-resident investment, according to national law firm Maddocks. FIRB recommendations were released in November, 2014 and included new administration fees and tougher enforcement, including criminal penalties, for rule breaches. …”This is a


Pettifor warns of GFC 2.0 approach

From The Guardian: Ann Pettifor of Prime Economics, who foreshadowed the credit crunch in her 2003 book The Coming First World Debt Crisis, says: “We’re going to have another financial crisis. Brazil’s already in great trouble with the strength of the dollar; I dread to think what’s happening in South Africa; then there’s Malaysia. We’re


New record lows for Aussie bond yields

The rampaging bull market in Australian bonds stampedes on. The 2 year yield fell to another record low last night at 1.71% (before selling a little):   The curve continues to steepen as the long end has not yet fathomed the depths of Australian stagnation:   There were no new lows for the Australia/US spreads