Macro Afternoon

Diverging fortunes here in Asia today as Chinese stock markets rallied while re-opened Japanese bourses slumped, catching up to the NY party. Currencies also diverged with a selloff in Yen followed by a gain in Aussie dollar as traders pre-position for tonight’s US unemployment print.

The Shanghai Composite rallied hard from the open to be up 1.4% or so at 2497 points as confidence comes back strongly with possible talk of stimulus.  The Hang Seng Index gapped lower on the open again, but this time rallied throughout the session, closing about 1.5% higher to 25445 points. This is still under previous support at 25600 but there is upside potential here:

US and Eurostoxx futures are up slightly going into the London open, with a huge session of economic events to follow tonight. The four hourly S&P 500 futures chart shows price clinging to the lower edge of the moving average channel with significant resistance at the 2500 level and a possible bullish falling wedge pattern:

Japanese stocks finally came back from their extended NY holiday although I’m sure most will have wanted to stay away with the Nikkei 225 falling 2.5% to 19509 points. The USDJPY rallied late in the session to be just above the 108 handle, still less than half way on a comeback from the previous breakdown:

The ASX200 started off poorly but slowly clawed its way back as a satellite bourse of Chinese stocks, finishing about well and 0.25% lower to 5619 points. The Aussie dollar also rallied ever so slightly and pipped above the 70 handle, hopefully wiping out any memory of yesterday’s flash crash:

The economic calendar concludes the week with the most important event of the month – US unemployment (non-farm payrolls or NFP). Before that though there’s the nearly equally important German unemployment and EZ wide CPI print. An action packed evening!

Have a good weekend, see you all on Monday as I return with Houses’n’Holes coming back as well.

Comments

    • Athletes seem to be easy prey for “investment guru’s” This sort of thing happens regularly.

      • The thing about footballers is….well, they’re footballers. Weird haircuts, covered in tatts and beaten up every week. And that’s just their wives and girlfriends.

      • Yeborsky, yup. Before they became mega stars and had money to burn via their dodgy managers mates investment idea, they used to often be car salesmen, which is about as hopeful they could be in the intellectual stakes.

      • You haven’t received enough brain damage, participation trophies and intensive management and accounting consultation to think otherwise MB.

        Hope their well diversified investment properties are doing well…. Chortle.

      • Mining BoganMEMBER

        Actually I did get concussed a few times. A couple of ambulance trips too. When I finally went bald my head looked like a soccer ball with all the scars and stitches. Luckily I wasn’t good enough to be professional so complete stupidity evaded me.

        What’s going to happen when economic reality hits, folk realise they’ve been sold a pup and celebrity worship comes to an abrupt end? Do our sports stars and actors etc become pariahs for talking crap all those years?

  1. Mining BoganMEMBER

    So, all the Aussies have to do is score 800-850 then have Khawja and Laverneandshirley spin us to victory. Simples.

    • Doable in three days; two to score the runs and one to bowl India out. Can’t see too many flaws in this plan.

      • More precisely declare at 4/875 about 3.00pm sunday and have them 3 down at stumps on sunday.

        This is a situation we are missing MMarsh, to come in up the order for a cameo 180 off 180 balls and nip out a couple of top order wickets.

    • Genius. Lull the opposition into a false sense of security and then unleash the part time spinners. Border once got 7/46, and Clarke did spin Australia to victory over the Indian team on another occasion. It’ll be one for the ages.

    • At the of the day the cause is greed. The inevitable crowing glory of a property mania allowed to go on to the point that we don’t even care if the buildings will stand up for more than ten minutes.
      It’s all so predictable…

      • Totally.. those residents should thank their lucky stars the building has lasted a whole 4 months until now!

      • Yep, just gotta look to history to see the results of a greed infected property boom. Nothing ever changes.

    • The bagdolder scenario has so much potential material to reboot the Underbelly series.

      “Hi Bassam. This is Susan from CommInsure. Our data analytics group indicates your company may have sold an Opal Tower apartment to an Italian-Australian debt collection and building industry dispute resolution specialist. We are cancelling your life insurance policy.”

  2. Australian new car sales are tanking | Business Insider

    https://www.businessinsider.com.au/australian-new-car-sales-are-tanking-2019-1

    • Australian new car sales fell sharply in December compared to the same month a year earlier.

    • Some of the steepest declines were seen in NSW and Victoria, the states where home prices fell the most in 2018.

    • Australian household consumption slowed sharply in the September quarter last year. Coupled with recent softness in retail sales, weakness in car sales points to a continuation of those trends in the final three months of 2018.

    • Financial markets are now pricing a small possibility that the RBA cash rate could be cut by the middle of this year. … read more via hyperlink above …

  3. … China in trouble …

    Chinese Consumers’ Confidence Sags, Casting a Pall Over the Global Economy – The New York Times

    https://www.nytimes.com/2019/01/03/business/china-consumer-economy-apple-iphone.html

    Apple in China: Problems sound alarm on China economy – CNN

    https://edition.cnn.com/2019/01/03/perspectives/apple-china-warning/index.html

    China warnings signal Trump’s trade war finally hitting home | Reuters

    https://www.reuters.com/article/us-usa-economy-china/china-warnings-signal-trumps-trade-war-finally-hitting-home-idUSKCN1OX1XA

    • He means “laughing stock f*cker”, surely?

      Also – what? he doesn’t want to become the “daddy” in the “sugar-daddy”, or did I misread between the lines?

  4. TailorTrashMEMBER

    Wait until they get to bayonet practice ….that will be fun ….

    “That’s not a stick of celery you’ve got there son …..stick it in …turn it round and pull it out “

    Perhaps the new solders will only ever have to use virtual bayonets ….so all good

    But hard to imagine a snowflake having to wrestle with the concept of actually KILLING someone ….even to protect themselves ….never ….

    .but perhaps the British are Going recreate Kitchener’s Army with digital skills ……zap em on the computer …..sounds plausible
    https://www.abc.net.au/news/2019-01-04/the-british-army-was-millennial-snowflakes-and-selfie-addicts/10685194

    • The Traveling Wilbur

      I’m not clicking on the link, but Yes. Dignity, money, morals. All gone.

      And that’s just my day job.

      • It certainly is depressing. You can bet the Koch brothers have had their hand in that part of the country too. I’m surprised these rich cvnts don’t get offed in the gun toting states.

    • A sacrifice zone is the ultimate free market.
      Where you are free to get shot, free to get sick, free to go to jail or be an unemployed drug addict living in poverty.
      “free market” means a total absence of freedom to live a decent life.

    • I have been to Harrisburg PA and I reckon parts of that are Sacrifice Zones. The old steel mills are derelict etc.. it has an eery feel of going backwards.

  5. The Traveling Wilbur

    I swear Chris included the S&P chart just so he could draw a Dragon with the analytics.

    Anyone know if it’s Chinese?

    • TailorTrashMEMBER

      Hilarious also thinks she can still make it
      ….,.I like EW ….she sticks it to wall st …..and she can argue a point …..but who can take America by the horns …no JFK or FDR is in the wings and anyway
      seems way past the ability of any one “leader “

      • davidjwalshMEMBER

        no she doesn’t …… running interference to split the ‘young progressives’ wing of the DNC for a serious candidate. Watch this space. Pochahontis will get her pay off later ….

      • My comment has disappeared into the ether.
        The short version.
        Who is the serious candidate you are thinking of?
        Clinton will go again and Sanders is likely to as well. Trump may talk his way into a second term. Perhaps 2024 is a better bet for Warren.

  6. Watching the BBL in Hobart. There is an insanely red sky from the bushfires. I can’t help but think that this is an omen. Red sky at night, property bears delight. With all the knob buyers agents championing hobarts property price performance I hope and expect it to fall over this year.

    • mild colonialMEMBER

      I think I finally clicked as to what caused the Hobart boom. Originally I assumed it was some kind of white flight scenario but of course it’s not. Hobart, like Canberra, will have been deemed a regional centre for purposes of immigration with some study scheme attached and so migrants have no doubt flocked there. I heard it suddenly became this Chinese student rental bunfight. I assume same thing has happened in Canberra with our house prices staying strong, massive construction happening, non existent vacancy rate and a little story in the paper one day about colleges exploding with enrolments and people moving here. But less obvious in Canberra as a city used to transiting people, students galore and with all the wealth around. But we are booming much to the delight of our fearless leader The Apartment King. He’s canny enough though, he put out a refreshed planning vision update in 2018 saying over the long term we’ll grow at 7000 per year, putting off the 80% of locals who are over the break neck incessant tearing up of the city. I reckon it’s 15,000 extra a year at the moment and I reckon he knows that too. And the developers do and the two land planning agencies. how else would there be 7000 new dwellings under construction and being having no problem selling