It was on again today with banks bid out the wazoo when, alas, the good jobs number arrived:
The bid is dependent upon economic weakness and falling yields so more jobs sucks for banks, though they are still up on the day:
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There’s a good chance that the bid will resume, though, just so long as iron ore and miners get hit. Dalian is sinking fast:
Big Iron is taking it for the team:
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Even RIO is back in its trading range, hinting at a false breakout. Here’s the monthly chart:
The $70 level has proven to a serious spoiler for many years.
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Big Gas is mixed but the Pensioner Killers are solid:
Big Gold has finally fallen:
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Big Liar is stuck:
Morgan Stanley has an amusing take on the market today:
While still lagging global peers, the ASX 200 the last quarter of the year “with a catch-up trade” and “now looks to be making a run at the 6000 level that has proved elusive over the last decade,” write Morgan Stanley strategists.
The benchmark measure is up 3.7 per cent, including dividends, so far this month. But can it reach that elusive round number? The broker’s team is not so sure.
“While the index may well push toward this headline, we think to hold these levels and make further gains,a sustained earnings upgrade cycle from the real economy (that is, industrials ex-financials) will be needed, rather than further multiple expansion,” they write.
Come now, earnings? That’s so nineties. What we need is greater economic weakness to damage earnings. That might give us the lift above 6000 as yields plummet.
That is if iron ore doesn’t sink too far and drown the miners…
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.
