ASX Shares Daily – 23rd 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.

Its definitely not rabbit season – its unicorn hunting season! Today we saw the bearish response to Friday nights falls on European and US stock markets.

The ASX200 fell nearly 2% all the way down all day, closing down 70 points or 1.7% to 4128 points, reversing in a stroke all of last week’s gains.

If you thought that was bad, check out the rest of Asia, with the Nikkei 225 falling over 1.9%,  the Hang Seng a stonking 3.1% whilst the Shanghai Comp is down 1.3% revisiting its previous lows.

On currency markets, the broader risk off move saw the risk proxy de jeure, the Aussie down nearly 1%, losing over 1 cent to be just below the 1.03 mark against the USD, but still on its short term trend from the June lows:

The Euro/USD cross also took a pounding and is below the 1.21 level going into the European session as the US Dollar Index (DXY) improves with the 84 level a possible target tonight. The anti-dollar – gold (USD)   is currently slipping going into the London trade, bouncing just off the $1570USD level. 

In AUD terms, because of the drop in our currency, the shiny metal has risen slightly, now at $1527AUD per ounce.


Australian Stocks

Looking to the table at the left showing all the sectors and ASX8 stocks (the top four banks – Megabank – and the top four miners – all owned by foreigners mainly….),  were sold off but particularly miners and energy stocks as commodities come off the boil.

The biggest ASX8 mover was Newcrest Mining (NCM), down over 4% whereas Woolworths (WOW) actually gained today, leading the surge into staples as it announced better than expected sales figures (note: Macro Investor is long WOW in both model portfolios)

On to the index where the ASX200 has clearly had a bad day – reversing below the 50 day moving average and resistance at 4140 and once looked set to tackle the closely watched 200 day moving average, which is proving an elusive resistance level again. As we move closer to the start of the earnings season, the weekly chart proves illustrative, with an interesting pattern firming up in recent weeks:

The ASX200 needs to hold that bottom rising support line (in green) or it will be back on its way to 3900 points as this bear market continues.


Looks like a nasty night on risk markets, and just like how our fundies and insto’s have moved from equities to bonds (bond yields fell over 13 basis points today to an amazing 2.8% yield), the same is occuring in Europe – except nobody wants to own Spanish bonds….and maybe soon Italian bonds (Sicily is the Greece of Italy, which itself is a microcosm of Europe, separated into an industrious rich north and an impoverished, indebted south).

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

You can also find me rambling on Twitter here.

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    • We might look at WOW again this week in MI (we covered in our inaugural and had a BUY signal back then)

      I”m concerned due to sector rotation (out of disc into staples) that the price is getting ahead of itself, having been disappointed now for 5 years as it goes sideways.

      The estimated value (including dividends) is forecasted to grow 15% from this year to FY13, but the margin of safety is a bit slim as current price is only just below its current estimate of value.