Macro Afternoon

A fairly positive day on equity markets across Asia in response to the solid uptick on Wall Street overnight, although caution reigns as the US China trade talks get underway so Chinese shares are slowly retreating as Yuan appreciates against USD.

The Shanghai Composite is down around 0.3% or so at 2524 points as confidence wavers, still clinging above previous support at 2500 points.  The Hang Seng Index is down about 0.1% or so, down to 25806 points. This is just above previous support at 25600 but the lack of any new real daily high combined with daily momentum not yet positive suggests further sideways action:

US and Eurostoxx futures are up slightly going into the London open with the four hourly S&P 500 futures chart showing an eagerness to build on the new weekly high and ready to tackle the psychologically important 2600 point level:

Japanese stocks were the best performers in the region, with the Nikkei 225 lifting 1.1% to build above 20000 points, currently at 20276 points going into the close. The USDJPY has lifted again, almost getting through the 109 handle, breaking through significant resistance at the 108.50 level:

The ASX200 did well as the Aussie dollar weakened ever so slightly, lifting nearly 0.7% higher to 5722 points. The Aussie dollar has failed to make good on its recent gains, falling slightly as the trade balance figures came in lower than expected, retreating back to the 71.30 level against the USD, ripe for a reversion back to trailing ATR support:

The economic calendar has two main releases to keep an eye out on, first German industrial production, then the US November trade balance. Plus Trump’s speech on The Wall…

Comments

  1. ErmingtonPlumbingMEMBER

    While the media and establishment left is suffering spontaneous prolapses and hysterical outrage over a small bunch of misguided working class nobs,…..the real Nazi/Facist Shyte going on at a global level, detrimentaly effecting the lives of millions, gets little mention on shows like the Drum.
    It seems Disobedient plebs, within the west, who are not deferential enough to their “well educated betters” are the only “Nazi’s” worthy of a mention.
    https://www.nytimes.com/2018/12/15/world/asia/mckinsey-china-russia.html

    • McKinsey used to be a fairly pro capitalist ethical mob until an ill vapor blew into town [neoliberalism] and decreed profit [rents] was its own reward if’in not vindication of ones superiority over all others … en fin ..

      For bonus points read Veblen on the nuance of industry and business ….

    • C.M.BurnsMEMBER

      Can you please point to a single piece of content, picture or other evidence that McInsey are nazis / neo-nazis ?

      Because I can provide a whole heap of pro nazi images from St Kilda .

      And this “generous” use of the word nazi to people that you don’t agree with is really poor.

      • “McInsey are nazis”

        I can feel the gravitational waves of a new rabbit black whole warren thingy …. curse you ….

      • ErmingtonPlumbingMEMBER

        They are major enablers of the Authoritarian Chinese leadership in a Country that is effectively a surveillance police state with over 1 million people incarcerated in political Concentration Camps,…. exponentially closer to the travesty of “Nazi Germany” than a small bunch of yobs with stupid tatoos doing silly hitler sulutes.

        Did you read the article?
        Their support for grubby oligarchs in Saudi Arabia, South Africa, Turkey, Ukraine and Russia is equaly Facist like behavior in my view,…anti democratic and much more Treasonous to the sacrifice made by diggers in WW2 who were fighting the same kind of real fascism,…not the pathtic pretend stuff we saw at St Kilder.

      • C.M.BurnsMEMBER

        at least half of the fortune 500 are enablers, funders or otherwise supporters of the CCP and the current chinese regime (in so far as their respective companies can make a lot of money out of an emergent chinese middle class). that does not make them nazis.

        in parallel, Bain & Co, McInsey, BCG, Goldman Sachs can be accused of many things and many people in them are probably “evil” on most people’s moral compass but, they are not nazis.

        do you know who are nazis ? Actual nazis and neo-nazis. people that openly display the swastika and 3rd reich symbols and ideals. And you know, those people that give the heil hitler salute at a public beach in Melbourne. Like Blair Cottrell and the couple of hundred pukes with him on the weekend.

      • ErmingtonPlumbingMEMBER

        Stalin killed more people than the Nazis,…does that make those “hammer and sickle” and Che Guevara tee shirt wearers as equally threatening to western Democracy Burnsie?

        Are they all evil Commies out to collectivise all of our investment Property portfolios and comit acts of violence towards our “Centrist” bourgeoisie!!!???
        I see heaps more hipsters wearing that stuff compared to “Skinhead Nazis”

      • With that sort of “one world one humanity” perspective, Ermo, being more worried about foreign political prisoners rather than local rabble rousers, people could mistake you for one of those far-left no-borders progressives.

    • Well spotted.

      Cunning. Creep ‘em up bit by bit, use January as cover, slow enough that people don’t bother switching lenders.

      Hopefully others follow.

    • CBA issuing 5 year paper at BBSW+1.13% today. Compare that to the last 5 year issuance of 2018 by ANZ at BBSW+1.03% in December, and 5 year paper from this time last year at BBSW+0.77% — ie banks are paying 0.36% more this year!!! and then we have the 0.20-0.30% upward structural shift in the bbsw rate itself and we have banks paying 0.60% more all up versus last year.

      its on like donkey kong!!!

  2. Bit of a comedy piece from the AFR:

    https://www.afr.com/business/retail/retailers-stuck-as-shoppers-stay-home-20190108-h19u1z

    Retailers are scrambling to avoid a “liquidity crisis” after in-store foot traffic fell 8 per cent between Black Friday and Boxing Day, compared to 3 per cent over the same period in the previous year.

    “Foot traffic appears to have been weak as shoppers continue to shift December shopping trips online and pull forward purchases into Black Friday in November,” said Citi in a note reviewing the past Christmas season.

    Third, the declining in-store traffic was linked to rising cost-of-living pressures on consumers as they struggled against falling house prices and weak income growth.

    “Consumer spending is brittle. House prices are falling in metropolitan cities for the first time in 20 years,” Mr Stewart said. “That affects the psyche of the consumer: you don’t feel as wealthy as you did.”

    Don’t feel as wealthy? Mr North would disagree given his households note considerable increases in the cost of living with no wage growth, dangerous levels of debt and (usually unknown to the household) close to zero or negative cash flow for about 30% of them.

    Nice work AFR.

    • I personally avoided all Sydney shopping centres like the plague. Wait for 40 mins in the heat in crawling traffic about 200 metres away from the shopping centre. Then hunt for a non-existent car park, wrestle with hoardes of folks to buy crap I don’t need? Nah… Rather sit on my arse or watch TV. Shopping online is easy, click click click -> delivery details and done.

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