ASX, Aussie dollar ignore slumping iron ore

Virtue signalling missiles is all that matters today with the AUD up:

Bond yields threatening to break out:

And XJO rallying:

Underneath it all, Dalian is -2.8% and getting worse after China’s lousy weekend credit data and another PBOC money market rate hike today:

Big Iron doesn’t care:

Big Gas is off to the races:

Big Gold too:

Big Sleazy has a little bid:

Big Pus is mixed:

A great day to sell dirt equities.

Comments

  1. JspitzerMEMBER

    Nice whack a mole on the ASX today. First move in Asia is always wrong – big equity futures bounce falling away.

    • JspitzerMEMBER

      FMG back through 4.50 took out lots of shorts. Strong case to say that was wave 2 of 3, with the next wave down the big one. It would make sense if iron ore went straight down from here, it did a year ago and has far more reason to do so now.

  2. The 90 day BBSW to OIS now blown out to 60 bps and futures are hitting new lows.

    DCE iron ore looks broken down on the daily though hasn’t yet made a new low so I guess you can cling to hope. Looks like some recent buyers in the miners assumed that it was going to break the other way.

    It still wouldn’t surprise me if SPX made another lower high but looks very much like a pump for the purpose of distribution.

    • JspitzerMEMBER

      Where do you source the BBSW to OIS? Banks are still cutting rates despite this. Think it shows how volumes are drying up.

      • Unless you have BBG or Reuters the previous day figures are in this spreadsheet (column K – column N or the cash rate):

        http://www.rba.gov.au/statistics/tables/xls/f01d.xls

        Delayed futures are here:
        https://www.asx.com.au/asx/markets/futuresPriceList.do?code=IR&type=FUTURE#

        I think this rate may have more relevance to smaller lenders. The big banks are in the position where they have plenty of liquidity from other sources. Still its interesting in light of what’s happening with Libor and the falling yield spread.

      • Banks racing each other to lock in those last customers (the good ones with a decent chance of meeting repayments) before hiking, maybe?

      • I don’t believe banks are going to hike, I think they are going to cut. They will use the smokescreen of the Royal Commission to reduce payouts to investors. This isn’t by choice, but they will be starting to notice that many of their customers are tapped out, and there are few new borrowers who are qualified to meet current housing prices.