Trading Day: 1st July

The S&P/ASX 200 was slated to make further gains today, but has moved down almost 24 points or just over half of one percent just after midday, now at 4584 points. This is possibly due to the weak Chinese PMI figures (forecast at an expanding 52, came in at 50.2) and the equally important Japanese large manufacturer confidence number has plunged to -9. This has resulted in a mild sell off of the AUD/JPY – a closely watched correlation for the ASX200.

Other Asian markets are still up on these results, with the Nikkei 225 up 0.5% at 9862 points, and the Hang Seng up 1.54% to 22,398 points.

Other risk assets are down or steady, the AUD just above 1.07, whilst gold is back down to support at $1501 USD an ounce. WTI crude is steady at $94.71 USD per barrel.

Movers and Shakers
It’s mainly red across the board with only a few stocks advancing. The four major banks are giving back most of their gains in the previous day(s), with ANZ down 0.58%, CBA down 0.9%, NAB down 1.05% and WBC down 1.12%.

BHP is steady at $43.80, whilst RIO is down slightly to $82.77

In other ASX200 stocks, Paperlinx (PPX) is up 9% followed by Transpacific (TPI) up nearly 4%. CSL is down over 1.5% to $32.54

The losers include Lynas (LYC) down 9%, Sundance (SDL) down 4.4% and JB Hi-Fi (JBH – the markets most shorted stock) down 3.2%

Daily Chart
The daily chart shows current prices have broken out from the downtrend channel but there is still significant downward pressure on the index as the next critical level is 4700 points. As I’ve been saying the 4500 points level has switched to support on the back of (another) Greek bailout. Technical indicators only suggest a small rally at this stage, with no confirmation of momentum or directional range.

Daily chart of ASX200 - click to enlarge

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  1. innocent bystander

    “This is possibly due to ”
    yesterday’s eofy window dressing on thin trade on major stocks ?

    • Ive been thinking that too IB.

      My short term system is “hold” on the index.
      My medium term system is short (but tightened stops). And I am short the market overall btw, but long a few stocks here and there.

      There’s just no driver for a new bull market in stocks that I can see, and this is reflected in the long and medium term charts.

      • This is where the higher yield paying stocks (assuming they can maintain their profitability) will be the ‘standout performers in the market as this is where the majority of the returns will come from. I think the best case scenario over the shorter to medium term is a sideways market.
        The only thing that could possibly drive a new bull market is the creation of a large QE3, which is unlikely and in the long term bad for us all.