ASX Shares Daily – 12th July

 

By Chris Becker

These daily updates need to be placed in context with the longer trends and drivers amidst the overall technical picture, so head to Macro Investor for a free trial. Former “Trading Week” readers will find it reborn asTechnicals“, published 8.30am each Monday morning.

 

So, pick your poison. Bank of Korea surprises with a rate cut – Bank of Japan extends its stimulus (although no net change) – RBA says AUD is not a speculative currency…… (I lost a good espresso reading that one as it came across the Bloomberg)

Bad jobs data (internals look worse than headline number).

Etc etc etc. (use your best Yul Brinner inner voice)

As you can see in the table opposite, the ASX200 closed down almost 30 points or 0.75% to 4068 points to extend a 6 day losing streak (good timing for the BEAR ETF? I’m covering that in this week’s Classroom on Macro Investor). Check out my daily technical analysis of the ASX 200 after the wrap at the bottom of this post.

The New Zealand NZ50 finished up 0.6% (and apart from the BSE and STI, one of the best performing Asian markets right now) whilst the Nikkei 225 lost over 1.5% on the stimulus/not stimulus paradox. Big divergence in the Chinese market – the Hang Seng was down a solid 2% but the  Shanghai Comp continued its little jump and was up 0.5% it teeters near its January lows just above 2145 points.

 

On currency markets, the Aussie was haaammmmmerrred. Well kind of, I’ve seen worse, it fell 1% on the jobs data and probably a bit more risk-off attitude – it ain’t no safe haven. I will punch the next economist who says that…if you’ve been following Cameron Murray at the ACE2012 conference, I think he wants to do the same…

Back to the analysis: the AUD has firmly rejected resistance and is likely on its way back to parity – if it doesn’t hold, we’re off down to 97 cents again. The Euro/USD cross is also slipping, as news out of Europe continues to sour, whilst King dollar via the US Dollar Index (DXY) was sideways.

Gold (USD)  continues to lose as a result, flat this morning but slumping in the afternoon session, now at $1568USD, whilst in  AUD terms, it remains steady at $1542AUD per ounce

I said before that the sideways weakness looks like cracking into outright falls if it closes below $1526AUD – we are keeping a very close eye on gold in AUD terms, as this is a hedge within both our model portfolios. 

EDIT: forgot Aussie 10 year bonds! Yields down 11 points to 2.87% Jeesh..I remember when there was a 5 in front of the yield, not too long ago, in a galaxy far far away…

European bonds are all being bid up strongly – French are down 11 points to 2.2% on the flat CPI print, bunds yields down, Italian/Spanish down 6ish points… All Euro stocks down 1 to 1.5%….

Australian Stocks

It was clobbering time for the ASX8 today, and again the Small Ordinaries fell even further – this signals to me, with staples like WES and WOW gettting bid up, and health stocks like CSL and COH (Disclosure: I own a lot of COH through my super) that everyone is cycling out of risk and into less perceived risk – including  Telstra.

The big mover in the ASX8 (the big four miners and big four banks, seen in the table to the left) was Newcrest (NCM) – as gold continues to flounder at these prices. Fortescue (FMG)  was also hit hard – this will make a certain Mr Chanos happy…

 

On to the index – the ASX200 looks like heading down to the 4040 first support level, and then possibly to just below 4000 points on the daily chart (candlesticks look better but having dramas with charts right now). Tomorrow being Friday the 13th, could we see a 3,XXX print for the bourse?

 

Tonight

Tonight has several major data prints, with French inflation first (it was flat – “gallic shrug”) and then EMU industrial production, then the usual weekly US jobless claims.

Ouch – I just checked, tomorrow we get Chinese GDP, industrial production and retail sales figures….this will be a very interesting day to say the least. I’ve got trades and ideas coming out of everywhere for our subscribers right now – not all short either….

Don’t miss the overnight market updates by my colleague Greg McKenna, in MacroBusiness Morning.

You can also find me rambling on Twitter here (and unlike some commentators, I’ll actually reply, if you ask nicely!)

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Comments

    • 6%? Come on, mine-bot… You’ll be concerned if it’s lower than 8%. I’ll be buying ammo and canned food if it is lower than 6%.

  1. RBA says AUD is not a speculative currency…… “(I lost a good espresso reading that one as it came across the Bloomberg)”

    The walls in my office just got badly damaged!!!