by Chris Becker
Its going to be a rough week for Aussie stocks following the Fed stall call. The ASX200 has opened down -2.5%, mainly led by the banks, but also mining stocks with BHP and Rio Tinto both off by more than 3%:
As I explained in Macro Morning, the falls in Aussie bank stocks are mainly due to the German DAX, which slumped over 3% on Friday, plus the overall bearish mood from US stocks on Friday. The key level to watch is not just 5000 points on the ASX200 but the 6400 point level on the financials index (XXJ). A breakthrough there and this correction will spill over into full bear market territory:
The Shanghai Composite, which pushes and nudges the local bourse more now than US stocks, opens in just over a half hour and while it just closed in the green on Friday, local traders (and bank economist ra rahs) are hoping for more intervention from Chinese authorities.