Macro Afternoon

See the latest Australian dollar analysis here:

Macro Afternoon

Stocks in Asia remain unsettled as traders await Fed Chair Powell’s testimony to Congress tonight, with some optimism sneaking through particularly locally as the Australian dollar goes lower again. Currency markets are also mixed, with the Euro steady while Pound Sterling is selling off going into the City open, while the Aussie and Kiwi remain under pressure.

The Shanghai Composite just can’t get any traction, falling again and down 0.25% to 2921 points going into the close.  The Hang Seng Index has come back however after five straight lower sessions, closing 0.3% higher to 28205 points, still below the previous set of highs at 28500 but at least isn’t going any lower with support firming at 28000:

Japanese share markets are joining in on the poor mood, with the Nikkei 225 taking back the previous gains to be down 0.15% at 21533 points.  The USJDPY pair is very slowly extending its gains but remains under the 109 handle going into the European session:

The ASX200 has also bounced back after the previous scratch session, up 0.3% to 6689 points, still not getting any help by the falling Australian dollar. The Aussie fell this time on the Westpac consumer confidence print, now heading back to the 69 handle:

S&P and Eurostoxx futures are flat with the S&P500 four hourly chart suggesting a possible bounceback to the previous highs but momentum remains mixed:

The economic calendar will focus squarely on Fed Chairman Powell’s testimony in Congress tonight but also includes the Canadian central bank meeting and the latest DOE oil inventory report.

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  1. BrentonMEMBER

    Investors are set to benefit from switching out of bond proxies and into growth stocks amid signs the economic environment is improving, say Macquarie analysts.

    “There are risks to growth from tariffs, but the [Reserve Bank of Australia] has cut rates twice, the [US Federal Reserve] could be next, the domestic housing market is improving, and the OECD leading indicator signals an improving US cycle,” Macquarie analysts said in a research note to clients.

    Every other time the OECD Composite Leading Indicator broke 99 it wasn’t telegraphing an improving US cycle…

    “We were early in rotating out of bond proxies in April, but still think this is the right move,” the analysts said.

    Oh, they’re in the red and desperately talking their book lol.

    • The Traveling Wilbur

      April? Loooooooooooooooooooool. LOL.

      There are people on this site, more than one, who could use their posted comments to prove that they deserve a better job. With Macquarie. Than those idiot bond trader/s they’ve had for the last 4 months.

      In some cases ‘a job’ even.

  2. … CHINA …

    China’s Losing Control Of Its Crushing Debt Load As Defaults And Missed Payments Skyrocket | Zero Hedge

    China’s economic slowdown and heavy debt load is affecting everybody in the country – even it’s “jewelry queen”, Zhou Xiaoguang, according to the Wall Street Journal.

    Zhou, who went from selling trinkets on city streets to taking a seat in China’s parliament and becoming Ernst & Young‘s “Entrepreneur of the Year” was faced with the reality of being unable to pay her company’s billions of dollars in debt while in a bankruptcy court in April.

    She is just one example of a massive debt burden taking its toll on China. … read more via hyperlink above …

      • Mining BoganMEMBER

        In yesterday’s stage there was two Nikens and one conventional bike following two riders on a downhill stretch. The Nikens looked tremendously well balanced…although in saying that they’d all be professional riders and could make anything look good.

      • desmodromicMEMBER

        Yep. You should never do on four (or three) wheels what you can do on two—preferably Italian.

  3. From Perth to Swansea, via Asia: how a $1.5bn company helps recruit international students for Western universities
    Earlier this year, a consortium of buyers took an Australian company private in a multi-billion-dollar deal. The move wasn’t a play on commodities, real estate or any other of the other lines of business you might associate with the country’s economy.
    Instead, it was all about education.
    Navitas, which was founded in Perth in 1994, was bought for $1.5bn USD by a consortium which included private equity firm BGH, Australiansuper, the country’s largest pension fund, and Rod Jones, its former chief executive.
    Its business model relies on the huge rise in international students looking to study in English-speaking countries. Navitas is part of a little-understood network of companies and agents that influence where these students end up — and which university receives the lucrative fees they are willing to pay for a Western education.
    Navitas had an annual turnover of $930m in 2018, and has 45 partnerships with universities around the world, which provide more than half its revenues…
    File under technofreemarket innovative, smart [tm], disruptive, clever etc…(with due attribution to the dishevelled one)

  4. Can’t access the Canberra unit boom courtesy of Geocon post ‘cuase I’m a tight chunt but there’s plenty of odour around their political connections, build quality, getting the bustards to pay up their buyer incentives, etc.

  5. The Traveling Wilbur

    Can’t figure what I like most about the Black Caps tonight. Their deliberate bowling effort, or the coordinated bowlers’ return to 70’s facial hair stylings.

    Boult’s just letting the side down.

  6. The Traveling Wilbur

    BBC rope-in commentator on NZ swing bowling:

    “It’s like a flower that only flowers briefly and then dies.”