Big iron sags as reality bites

Slowly but surely the big iron ore bounce is sagging with BHP down -2.3%, RIO -1.1% and FMG -1.4%:

Dalian is trading up five points from overnight but is still pricing around $51 so spot could still fall again tonight. Morgan Stanley cut its forecast average price to $40 for this year and $37 for next year. Both are well below the Federal Budget’s current outlook. Take note, Treasury.

LNG is also soft with WPL 0.7%, OSH -1.1%, STO -1.6%, ORG -1.6% and LNG 3.4%:

STO and ORG appear to have double tops in place…

Banks are getting a bid today as markets here catch up to easing credit spreads elsewhere with CBA up 1.3%, WBC 0.7%, NAB 0.4%, ANZ 0.6%, BOQ 1.1%, SUN -0.7% and BEN 1.2%:

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.