Macro Afternoon

by Chris Becker

Hesitation across Asia as the reaction to the debt ceiling deal in the US which sent American and some European stocks higher did not translate to similar gains here. Most markets put in scratch sessions or mild losses as the USD continued to retreat while commodities were relatively stable. Risk is prepositioning for the ECB’s interest rate meeting later tonight in addition to unresolved tensions in Korea and the looming prospect of further devastation from Atlantic Hurricanes.

In mainland China the Shanghai Composite finally couldn’t finish its current run trying to reach up to 3400 points by dropping almost 0.4% to 3373 points, breaking a five day deadlock.  The Hong Kong based Hang Seng Index is off a similar amount, now down more than 2% since its recent high but holding on to daily support:

Japanese stocks reacted positively to the selloff in Yen overnight, with the Nikkei up 0.2% to 19396 points. This keeps it well below the very firm resistance at the 20,000 point level and still beholden to further moves in Yen.  The USDJPY pair is giving back some of its overnight gains, currently hovering just above the 109 handle:

S&P futures are somewhat steady but the lack of volume and direciton here is telling

The ASX200 this time gapped up on the open, but wasn’t able to stay there for the session, eventually closing for a scratch result at 5689 points. Yet again, no real direction or definable mood as we swing around the 200 day moving average again.

The Aussie dollar remains below 80 cents against the USD with a muted response to the retail and trade figures today. Resistance just above the handle is where the action will be on the upside but I’m closely watching the low moving average at 79.65 for a breakdown:

The data calendar tonight will focus squarely on the ECB interest rate meeting. All eyes on Euro!

Comments

    • The Traveling Wilbur

      Did you hear? There’s 20,000m2 of the stuff they’re ripping off the pa HOSPITAL in Brisbane.

      Irony much.

      PS Second!

    • Good find Ortega.

      Funny that Domain forgot to mention this from that expat survey:

      “[The rating] is not helped by the fact that New Zealand has the second most expensive property prices in the world, with Australia only falling slightly behind in third place. Expats certainly feel this financial drain: over six in ten respondents in Oceania find accommodation unaffordable, and one South African expat in New Zealand even described the cost of living as “horrendous”, while one German in Australia finds that “rental prices and cost of living are far beyond average”.

    • Don’t worry mate, just got an email from The Property Council of Australia saying they oppose the banning of cladding, as the building standards in Australia are much better and a Greenfel like scenario couldn’t happen here.

      So it’s all good

    • Domain must have ordered a bunch of violins from Amazon recently because they also published this nonsense and suddenly Andrew Bloody Farkin Wilson seems to have a heart for first home buyers? What gives? Could self serving grubs at Domain suddenly see the forest for the trees and realise the jig is up and now they want to change the rules and let young people back into the market for their own survival of listings and turnover? Nah…

      https://www.domain.com.au/news/a-broken-property-market-bank-of-mum-and-dad-funding-a-third-of-firsthomes-20170905-gybmsa/

      But riddle me this Batman? Why the sudden consensus that negative gearing is bad?

    • Here’s where you can go instead, Berlin!
      https://www.domain.com.au/news/young-australians-moving-to-berlin-for-cheaper-rent-and-better-quality-of-life-20170428-gvukrr/

      According to Numbeo, the online cost-of-living database, you can maintain the same standard of living in Berlin ($4488) for over 40 per cent less than in Sydney ($7370), assuming that you rent in both cities. Consumer prices in Berlin are 35 per cent less and the rental costs are almost 65 per cent lower.

      • Not so easy as it once was. My friend in Berlin pays 1500 euros per month and the in couple in Frankfurt pays 2350 pm for a tiny apartment where they have to do all the maintenance, ie install a kitchen etc. Prices have doubled in the past 3 years and many units are being taken off the permanent rental pool and converted to Airbnb. The huge migrant intake by Merkel has all but taken every available low cost housing residence off the market thus placing even more pressure on the already tight rental market. The migrant issue is huge politically and Germany has just recently amended the refugee family reunion policy leaving many stranded.

  1. Latest poll … New Zealand General Election 23 September ….

    New Poll: Labour widens lead over National to 4 points in latest 1 NEWS Colmar Brunton poll | 1 NEWS NOW | TVNZ

    https://www.tvnz.co.nz/one-news/new-zealand/new-poll-labour-widens-lead-over-national-4-points-in-latest-1-news-colmar-brunton

    The Labour Party has widened its lead over National to four points in the latest 1 News Colmar Brunton poll out tonight, registering an approval rating of 43 per cent to National’s 39 per cent. … view and read more via hyperlink above …

    Further postings today …

    http://www.kiwiblog.co.nz/2017/09/latest_poll-61.html/comment-page-1#comment-2015889

    https://www.macrobusiness.com.au/2017/09/links-7-september-2017/#comment-2949588

    • Mining BoganMEMBER

      There is the accepted wisdom that we here in Oz sail 6-12 months behind Canadia. That would be very good in this case.

      However…is this like the accepted wisdom that the Liberals are better economic managers just because one evil rodent kept on repeating it in the face of all evidence telling us otherwise?

      I’m quite prepared to have my disappointment in the Australian people to continue for some time yet.

      • Mining BoganMEMBER

        Boganistan, where the flag has GOAT Lyon’s face, Jack the dog is Admiral even though he’s scared of water, and a visa costs a slab and only lasts until said slab runs out or Jack bites you.

      • Yes. Unfortunately the Canadian Fed hiked rates. This helped pop the bubble, probably inadvertently. I say “unfortunately” as there is now even less chance our Reserve Bank will do the same. They will be shitting themselves.

    • Prices still up YoY, so all they’ve done is blow the froth off the top. I don’t know whether that is horrific or consoling… only time will tell.

    • Quick perusal of Canadian property blogs & comments shows Canadians well-N-truly shit-ting themselves after 2 rate rises, saying they are being “punished”, and that they were “drawn-in”, and “duped” by greedy banks and developers etc. etc. “Middle income people can’t afford rate increases” said one, lolz, coooor help me.

      Will be same-same for Oztraya when the SHTF here.

      Except pain will probably be worse.

  2. TailorTrashMEMBER

    Phillip Ruddock is running for Mayor of Hornsby on a platform of
    ….”.fighting overdevelopment ”
    ……”strengthening the protection of the natural environment and bushland”
    ……”delivering the infrastructure and services our community needs ”

    Now that is funny ……wonder why he bothers ……… Hornsby and right out through Asquith now resembles Karl-Marx -Stadt. with out the quality of their buildings .

    One wonders where he proposes all the new citazens he and his LNP governments ( and labor) poured in and continue to do so. Perhaps he just wants to get back to where the real action is in Straya and drum up some more donations from the developer mates for the next federal election .

  3. truthisfashionable

    Does anyone remember who made the chrome add-in for the MB site that allows you to view/sort the most recent comments?

    Hoping to get a port of it over to Firefox.

    • T’was me. Now that Firefox have changed the way their extensions work it does actually seem to work okay lol. You want me to try to publish it to the Firefox add-ons?

      • truthisfashionable

        That would be awesome if you could, its one of the most useful extensions i’ve seen.

        The temporary workaround I detailed below is very… temporary.

      • No worries, I’ll give it a go. Google (bless ’em) will let you put up any old whatever, but Firefox apparently like to review and approve add-ons. So depending on how they feel about my shoddy coding, it may or may not get the green light on the first try. We’ll see, and I shall report back when I hear something.

    • Those same mugs paying $200-$300k over reserve price, now suddenly might be in the poor house? Oh dear… where’s that tiny violin I had?