Macro Afternoon

See the latest Australian dollar analysis here:

Macro Morning

Asian stocks could not build on their boisterous start to the week with a flat session across the region due to the lack of lead from US markets which were closed overnight. The USD surged however with all pairs falling including Yuan which the PBOC again weakened.

The Shanghai Composite is basically flat, down about 0.2%, currently at 2749 points going into the close. The Hong Kong Hang Seng Index is also off, down about twice as much or 0.4% to 28240 points. Again this means no new daily high with clustering around the 28500 resistance level, so I’m watching closely for signs of a reversion and down to the low moving average:

US and Eurostoxx futures are flat in line with other risk assets with the S&P 500 looking to build on reopening after the long weekend with the 2800 point level the target this week:

Japanese stock markets did a little better, with the Nikkei 225 about to close a few points higher, currently at 21307 points, still back above key resistance that had been broken briefly last week. This was helped by a slightly weaker Yen with the USDJPY pair finally moving after spending Monday in a daze doing nothing. It’s still not much with no close above the high moving average with momentum also not moving much higher on the four hourly chart, so I’m cautious:

The ASX200 was actually the best in the region, lifting nearly 0.3% and closing at 6106 points. The Australian dollar flipped on the RBA minutes though, falling straight down to the 71 handle after being a little buoyant on the Monday morning gap. This reversal could see last week’s lows threatened:

The economic calendar ramps up with the closely watched German ZEW Survey and some Treasury auctions

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  1. The Traveling Wilbur

    Furst, loosers!

    PS can anyone explain why when DXY goes *up* atm the short term Treasury yields drop? In which Seinfeldian existence does that work? Just curious.

    • Stock market game starts thursday
      make sure you are playing. TTW would be a good handle
      I’m there in full name Wiley Wolf

      • I’ll see if I can find my login.

        I can lose pretend money just as easy as I lose real money.

    • Well TTW you could imagine a punter buys some USD so the USD price goes up. Then he figures he’d better do something with it so he buys T Bills so they go up too (ie yields drop).

      Or is life not that simple.

      • The Traveling Wilbur

        Right now that makes perfect sense actually. I’m waiting for it to break the yield curve… just for the chuckle value.

        Things will revert to form after the Trump Trade Turmoil Tension… crystallizes. One way, or another…

      • Delete the e and you are on to it
        I saw a utube clip of PH questioning a navy admiral on the purpose and function of these new subs
        Now had she been adequately briefed, she could have made a story
        but to be a leader of a party and not be briefed nor understand the basic function of the subs
        is unforgivable.
        she has to go.

      • Not necessarily. It’s a fair question “what are these for” ie “do we actually need them and are they useful, which enemy and situation are they envisaged for use against, does that match reality, was this money well spent”.

        It’s a valid question.

      • A2 answer above
        I cant answer any of your questions
        My call is not to purchase them, cos by then technology will have overtaken this design
        but if their role is to land our commandos on foreign soil, so they can go about causing a nuisance
        there are better and more safe options for that
        Next question: who would be silly enough to have anything to do with the military
        when you can hire mercenaries on a no win no fee basis

      • “if their role is to land our commandos on foreign soil, so they can go about causing a nuisance
        there are better and more safe options for that”
        Actually there aren’t, if you want to do it discreetly.
        Although that isn’t their primary purpose. Sinking a chinese aircraft carrier parked off the east coast, as was suggested by this blog a while ago is actually the primary reason to get them, and they are highly effective at this. Why do you think all the large navies of the world operate subs?.

  2. it just feels 4 corners did not cover all the corners yesterday. are they leaving but wait there is more for early may in order to totally destroy the LIBS?

    • What they covered, apart from the faces to the names is common knowledge here
      Sanctuary Cove is in all sorts of trouble
      I’ll check my notes on the Jewell and the Spirit and I think I will find that these investment led developments were intended to offer Strayan citizenship to Chinese, after they had purchased a unit.
      the AFR covered it well mid last year.

      • Any more detail on Sanctuary Cove Wolfie?

        I’ve spent a great deal of time there over the last decade and one thing that’s always surprised me is the relative lack of Chinese owners in there. There’s multiple bus loads going through on a daily basis and it has formal FIRB exemption (like the rest of Australia really), yet they’re not prominent in there. I come back to Melbourne and I’m swamped. A Chinese mate reckons these property buying tourists are so dodgy they won’t buy there because in trying to get their cash safely out of China they fear these FIRB integrated tourism resorts are an obvious place for the CCP to look.

        Nothing sells in there quickly at the best of times. Prices nearly halved between 2006 and 2011, although they’ve recovered back to the 90% mark again. They’ll get absolutely shellacked in this next downturn.

    • 4 corners can do an “investigation “ into the housing bubble without even mentioning foreign buyers, they have form, maybe should be renamed cut corners

      • Thanks Gav.

        ‘Sif, Shawn.

        Note also that UBank still at 3.59% BUT they have a new pastel pink colour scheme on their front page. Biggest change in yoinks! Something to get excited about.

    • They have no need to bring APRA into it………..RBA just needs to say that mortgages above 4.5 times income will not be eligible for repo and a lot of the nonsense would stop tomorrow

      • You never learn. Regulatory intervention isn’t what’s needed. As you’ve now seen with APRA – it’s very much “easy come, easy go”.

        The bubble needs to run to the absolute apogee imaginable so that it can leave the biggest possible crater when it ultimately collides with the ground again

        Luckily the RBA is on it – they will oblige by cutting rates and re-boosting the bubble again. It’s coming soon

      • Weird how such craters bring out all the nasties the far right use as bogeymen, after decades of enabling the potential that sets the stage for impact due to ideological beliefs.

        Strange how some never consider if humans are not responding to the ideology that its not the humans that are the drama ….

    • An old girlfriend had an auto A4 (08 or 09) and I thought it was shyte. A 1980 Peugeot 504 I owned was comparable but a better ride. Some of the trim around the A4 drivers door handle broke and a few bits of plastic cost $400. I wouldn’t buy one.

    • The best car of that period was the e46 m3. Obviously more expensive but that’s what I’d be going for.

    • Dunnydore Sportwagon might be your best bet for that kind of transport. Sure the fuel efficiency might not be the best around town, but it’ll be cheap to fix (and a lot newer at the same price point).

      Mazda 6 Wagon will give you Jap reliability + fuel efficiency.

      A VW Passat of the same era is basically the same car as an A4 with a cheaper/nastier interior and without the Audi tax. R36 if you want a fast one.

      3L Liberty GT ? Reasonably quick, pretty bulletproof and should have plenty of go-fast bits available.

      • ” but it’ll be cheap to fix ”
        No doubt the shuttering of the local car manufacturing industry will change that at some point soon. The factories making the parts locally for cheap likely won’t survive just selling replacement parts aftermarket.

    • [While breaches increased, FIRB-approved investment in housing by foreign buyers fell by 58 per cent year on year to $12.5 billion, its lowest level since 2009/2010.]

      Bubble numbers.
      Needs to drop another 90+%