Macro Afternoon

Leading up to tonight’s FOMC meeting, stocks in Asia are somewhat mixed and rolling around without any big moves. The Australian dollar blipped up towards the 72 handle on the latest CPI print which was slightly higher than expected, while Yen was unchanged but offshore trading in Yuan strengthened considerably.

Chinese shares are mixed with the mainland Shanghai Composite currently down 0.3% to 2586 points while the Hang Seng Index is up slightly or about 0.1% to 27546 points, still maintaining a daily close above the previous false break high above 27100 points which continues to give the bulls hope:

US and Eurostoxx futures are unchanged going into the London open with the four hourly S&P 500 futures chart barely holding on to last week’s support at the 2630 point level where the BTFD crowd needs to step in after what could be a dovish FOMC outcome:

Japanese stock markets are off the most due to a stronger Yen with the Nikkei 225 falling about 0.3% lower to 20584 points. The USDJPY pair continues to hover above trailing ATR support at the low 109 levels but it could reverse below very quickly here:

The ASX200 is the best performer, closing 0.2% higher despite a stronger AUD to finish at 5886 points. The Australian dollar put in a strong surge to almost break the 72 handle on the back of the CPI print this morning and is almost ready to break the Monday morning gap higher and possibly make a new two week high if The City traders can come along for the ride:

The economic calendar continues overnight with two major releases – first German CPI and US 4Q GDP print, followed by the FOMC meeting outcome.

Comments

    • Mining BoganMEMBER

      Geez, just about everyone is a celebrity these days. Maybe there needs to be a clarification of the rules.

      Anyhow, doesn’t matter. Just another who has lost the right to walk the streets in safety, in a totally non white patriarchy all inclusive genderless all arseholes deserve beatings way.

    • reusachtigeMEMBER

      Hey bloke, you need to beat these hard workers at their own game. Offer your services for $7.50/hr and take their jobs!

      • I am not allowed to! We could replace the minimum wage law with a wage top up law – that would allow Aussies to work for $7.11/hour and have a total income of $18k/year via a wage top.

        I note that you posted your comment at 7:11 pm.

    • I love the extra details:
      – the business that got flattened is a smash repairer
      – the builder is called Chase! (not so much a name as a recommendation for what you’ll have to do to get your money back).
      – if only the building was called Phoenix (but believe it or not there is already a Canberra apartment block called that!)

      • The Traveling Wilbur

        Now THAT is something Alanis Vocab’s Not My Strong Suit Morisette​ could have written lyrics for. Correctly.

      • Says something about local construction standards: they allowed a boghouse to remain in use right next to a multistorey wall under construction (I’ve seen at Belconnen lollypop men allow vehicles to continue to use a roadway directly underneath as a crane moved concrete panels around). Canberra: cowboy construction country.

  1. The Traveling Wilbur

    The ASX200 consists of 3 things: Banks, Miners – mainly ones who do IO, and everything else Australia does – which is what, about 5/19ths of SWFA?

    So can someone please explain to me, given that China and our Banks are officially in the sh1tter again, how the ASX200 keeps going up? Please.

    Ta.

  2. Note discussion of the ‘flight to affordability’ … indeed a global issue …

    Guangdong’s growth slump is seen as a turning point for China’s economy, say analysts … South China Morning Post

    https://www.scmp.com/economy/china-economy/article/2184195/guangdongs-growth-slump-seen-turning-point-chinas-economy-say

    • Country’s most prosperous province has set lower 2019 growth target that matches expected national target as fast growth fades and trade war clouds outlook

    • Provincial officials have made helping private sector to boost growth a priority

    • Good thing Trump stepped up to take the heat so the Chinese can change economic gears to a more consumer blend economy.

  3. Credit crunch to trigger worst housing downturn since 1890: Endeavour
    https://www.afr.com/business/banking-and-finance/credit-crunch-to-trigger-worst-housing-downturn-since-1890-endeavour-20190130-h1an43
    [By Jonathan Shapiro
    Property prices could ultimately fall by 25 to 30 per cent from their peak, marking the worst downturn since 1890, according to an independent equity market analyst who has modelled the impact of tighter lending standards likely to result from the Hayne royal commission.

    Douglas Orr of Endeavour Equity Strategy, last year predicted property prices would fall 20 per cent. But he has now downgraded his forecast based on the “new revelation” late last year that all, or almost all, mortgages written between 2012 and 2016 had used the Household Expenditure Measure to assess borrower expenses. He warned of a rise in loan defaults as recent buyers found themselves in negative equity.

    Applying a more realistic benchmark would reduce the borrowing capacity of high-income householders by half, thus curtailing their ability to bid up properties, he said.]

  4. Heard on the radio today some property developers offering to pay your mortgage for a year to entice buyers in (quoted amount was $60k) for houses starting at $550k or so. Located central coast and some other fringe suburbs of Sydney (Illawarra?), Nice way to discount without discounting, I can’t recall company name now.

  5. The Traveling Wilbur

    Hmmmmm… Blistering on the heal of each palm. And it’s not even Friday.

    Guess I have to ask myself: “And what would haroldus do?”.