Macro Afternoon

It’s not looking good out there with volatility rising and stocks falling across the board in response to Friday nights US unemployment print and the weekend revelations of the Huawei arrest (and Trump’s possible impending arrest?) and the big drop in US Treasury yields as safe haven buying trumps a Santa Claus rally.

The Shanghai Composite was actually one of the better performers, down only 0.8% to 2584 points, but no longer able to hang on above the previous support level at 2600 points.  The Hang Seng Index has retreated even further, down 1.3% to 25718 points, still well below the previous support level and the low moving average on the daily chart:

US and Eurostoxx futures are down over 1% going into the London open, with the daily S&P 500 futures chart showing a definite downtrend and series of lower daily lows that are going to culminate in a capitulation soon:

Japanese stocks were hit the hardest as Yen buyers stepped in on a big gap down, the Nikkei 225 closing 2.1% lower to 21219 points, making a new weekly low.  The USDJPY pair came back slightly on the gap down and while there is a tentative bullish falling wedge pattern forming here on the four hourly chart its very early days, where I’m looking for a nother break below the 112 handle:

The ASX200 also joined in on the selloff, banks contributing most of the carnage, finishing 2.2% lower to 5552 points, previous support at 5700 points a distant memory. The Aussie dollar gapped lower but came back slightly, still staying depressed and, hovering around the low moving average on the four hourly chart, getting just above the 72 handle but for how long?

The economic calendar starts the week fairly quietly as usual following the NFP with some Treasury auctions tonight.

Comments

  1. https://www.msn.com/en-au/news/australia/nsw-government-announce-toll-relief-for-drivers/ar-BBQJEZX

    So the New South Wales State Government pays the registration for motorists . . .

    . . . so the motorists can afford to pay the tolls to the private tax farmer . . .

    . . . which has bought the tax farm from the New South Wales State Government . . .

    . . . which uses the proceeds trying to win votes at the next election . . .

    . . . by promising to pay motorists’ registration . . .

    . . . so the motorists can afford to pay the tolls . . .

    Australia has gone mad.

    This is a society run for the sole purpose of lining the pockets of investment bankers.

    • This is done to target a certain demographic. Only those who can afford the 1.3k a year in toll can claim it, thus removing the working poor from the equation.

    • Sounds like our GDP numbers; one person surveys hole, one person digs it, one person lays pipe, one person fills it, one person surveys hole, one person digs it…and so it goes around….

    • Noticed Bunnings now has started offering Zip Pay and another buy now pay later services provider. Might be a good time for the animals to rush thought their sketchy reno’s over Chrismass and unload the place early in the new year.

    • The Traveling Wilbur

      So (having now read that):
      A) +1.
      B) Nothing to worry about then.
      C) Is it significant that CoreLogic has made every map of Brisbane look like a masked scuba diver?
      IV) It was weird viewing that page initially, thought it was going to tell me it was for subscribers only.

    • Then there’s the Gupta family of five who own 30 properties between them. Hazard a guess but reckon maintenance is a low priority, that’s why they can afford 30 properties.

  2. The Sydney property falls are accelerating, and the last time they fell this far Australia had a recession
    https://www.businessinsider.com.au/australia-property-market-sydney-price-correction-recession-1991-2018-12

    ‘You bunch of idiots’: Australia’s tech industry savages Labor for backing the government’s encryption bill
    https://www.businessinsider.com.au/you-bunch-of-idiots-australias-tech-industry-savages-labor-for-backing-the-governments-encryption-bill-2018-12

    • New Zealand Herald (re-published) report ,,, giving Kiwis sleepless nights !

      Aussies told to prepare for ‘severe housing collapse’ – NZ Herald

      https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12174411

      Australia’s regulators have been warned to prepare “contingency plans for a severe collapse in the housing market” that could lead to a “crisis situation” in one or more financial institutions.

      The Organisation for Economic Co-operation and Development’s (OECD) latest in-depth assessment of Australia maintains that while the “current trajectory” of house price declines “would suggest a soft landing … some risk of a hard landing remains”…. Read more via hyperlink above …

    • The whisper is that the NSA can’t break Huawei’s encryption and that is why the panic to restrict them. Poor Professor Zhang.

      Suspicious fires in the European extreme ultra-violet lithography production facilities may also have been an effort to delay the export of this technology to China which is vital for the future of communications

  3. After that ABC delight, I wont have that remaining mini apple pie. I am satisfied.
    Look forward to tomorrow nights tidbits.

  4. Real estate company, developer and all round parasite will announce tomorrow that it is shutting down its Chinese investment division.

    • ErmingtonPlumbingMEMBER

      I wonder if we will we see “Yellow vest protests” here in OZ?

      Im not a fan of insurance company mandated hi-vis “safety” wear that must be worn to single out and identify working class plebs. The mandatory requirement to wear this garb always makes me think of the Jews having to wear their little yellow star of David’s.

      As a pro working class, left leaning kind of fellow myself,…Id like to see a little more Red on the streets,….you know,…mixed with yellow, I believe we’d get Orange,…wouldn’t we?
      An Orange vest protest movement for OZ ?
      How do you say that in french!?
      Oh, hang on a sec,…I dont like that Orange hi-vis $hite either,…maybe we could just wrap ourselves in Aussie flags!
      Where have I seen that before?
      🤔

      • Mining BoganMEMBER

        Councillors weren’t mixed up in real estate in those days either. Horse racing, pubs and footy clubs supplied the chambers.

        What a great time to be alive it was.

    • ErmingtonPlumbingMEMBER

      If they can happily thrown down a case of VB stubbies between 2 of them, every weekday evening after work…then I reckon they’d prove em selves good Aussie blokes worthy of citizenship inspitevof em not bein able to talk propper and that.

      • Happily? VB 🤢Stubbies/can/longnecks/shoes whatever 🤮………. and a pounding, deep headache the next day

    • Think of all the Gupta’s we could import! House price permanent boom forever. Reusa would love it, they can’t say no if they can’t speak Engrish…

    • ErmingtonPlumbingMEMBER

      Its all good and well to dream Gav,….but aren’t you just recently Married?,…mmm?
      Do you really think you could gain the nessary “Spousal approval” for such an unnecessary purchase?,…mmm?

      That GTR is the kind of toy you buy just before or after you bust up with the miissus.
      Once the kids come along Gav you really should liquidate that beloved Datsun rice burner of yours as well and use the money to buy a propper family car,…a people mover,…like a Tarago or something.

      This one has roof racks.

      https://www.carsales.com.au/cars/details/1996-Toyota-Tarago-GLX-Auto/SSE-AD-5522354?pageSource=details&id=SSE-AD-5522354

      • Lol yes true, I’m working on a station wagon. Nissan Stages which happens to be a GTR Wagon. (Same drivetrain) haha. Cake and eat it. Serious note I’m seeing lots of stuff like this on Gumtree. Sign of the times. This stuff would have sold instantly before. Now it’s lingering on the market, punters have run out of equity mate and the toys are being liquidated first.

    • ErmingtonPlumbingMEMBER

      Yes Gav,…True.

      I had a few Drag racing mates in the late 80s and 90s,…proper track drag racing,…and it was all V8s with 30k builds struggling to get better than high 9s or low 10s on the quarter.
      Then Years Later Im at Cloudbreak (2011 – 2014) and meeting a lot of young blokes on 130k+/year who are into drag racing in Perth and its all straight 6 high boost turbo Nissan motors in VL Commodores that their racing with Relatively cheap Of the shelf horsepower that eaisly has their cars pulling 8s !
      Makes me Wonder what the boy racers will be drag racing in another decades time.