Macro Afternoon

Most Asian stock markets are off today in response to the “too-dovish” Fed mood overnight, although Japanese bourses barely managed a scratch session due to a much weaker Yen. Weak data from China and in particular the canary-in-the-gold-mine decline in Korean exports is hampering risk sentiment as well. Perhaps the insurance cut is at the right time after all?

The Shanghai Composite has fallen nearly 0.9% to be at 2908 points while the Hang Seng Index continues to buckle, now at a new monthly low to finish down 0.7% at 27560 points. This puts it well below previous ATR daily support and ready to move to its May extreme lows:

Japanese share markets were able to rise slightly while under pressure with the Nikkei 225 closing 0.1% higher to 21541 points. The USDJPY pair turned its tentative breakout on the back of the Fed cut overnight into a proper move higher into the low 109’s where its stabilised this afternoon and ready to tackle the March highs nearer 112:

The ASX200 continues its retracement after reaching a record high recently, down 0.4% to close at 6788 points, mainly due to iron ore and commodity players. The Australian dollar is on the mat struggling to get up after being whalloped against last night, well below the 69 handle and back to its 68.50 recent low:

S&P and Eurostoxx futures are steady going into the European session with the S&P500 four hourly chart displaying the classic dead cat bounce pattern post a large selloff so I’m expecting further downside here tonight back below 2970 points as the Fed takes away the punchbowl:

The economic calendar says its the turn of the BOE for its interest rate meeting which will interesting to see if they can/want to arrest the decline in Pound Sterling while the US ISM Manufacturing print will be very closely watched following last nights “insurance” cut from the Fed.

Comments

  1. MEW ZEALAND: The bursting housing bubble … continued …

    New listings hit record low on Realestate.co.nz in July, asking prices trending down in most major centres … Greg Ninness … Interest Co NZ

    https://www.interest.co.nz/property/100979/new-listings-hit-record-low-realestateconz-july-asking-prices-trending-down-most

    The latest figures from property website Realestate.co.nz paint a very subdued picture of the market, with new listings and total inventory well down and prices mostly easing.

    The website received 7295 new residential listings in July, which was the lowest number of new listings it has received in the month of July since it began recording the data in 2007.

    Inventory, which is the total number of properties available for sale on the website, was also down, with 21,843 residential properties available for sale on Realestate.co.nz at the end of July, down 3.4% compared to July last year.

    Average asking prices have also been trending down, falling from $702,090 in February to $646,842 in July. … read more via hyperlink above …
    .
    .
    https://www.macrobusiness.com.au/2019/08/links-1-august-2019/#comment-3401816

    New Zealand’s money: How do you compare? | Susan Edmunds | Stuff.co.nz
    .
    .
    https://www.macrobusiness.com.au/2019/08/links-1-august-2019/#comment-3401686

    New Zealand’s serious long – term ( and politically can – kicked ) housing multiple stretch problem is coming to an end.

    By definition, all bubbles are unsustainable. … read more via hyperlink above …

      • And that article doesn’t even take into account all the Chinese specufesters that suddenly can’t be found to settle.

      • Yep. Doom.

        Where is JSpitzer, this is his main theme as he goes short everything Australia…

      • Paging Mr Wong for settlement. And Mr Li. And Ms Wu. And Mrs Chan….

        WTF….where are all these people? Get them on the phone and tell them they have a legal obligation to settle for the amount due. What do mean they aren’t answering their phones? In Shanghai? They are in Shanghai? And won’t talk to us….or pay their accounts? And you reckon there’s no way we can locate a bloke named Wong in Shanghai? Really? Errmm…ah…how about Mr Gupta and Mr Singh in Delhi? No answer there either? Oh dear…:glances around nervously. Loosens collar:…oh dear…..

    • E.U. and the U.S. recession with a potential for the U.K. to trigger a Minsky … Austerity post GFC combined with growing environmental factors. Ideologues with stakes in the ground compounds error, rather go down with the ship and take everyone with them than to something about it that contravenes their ideology w/ side of self serving.

    • Timmeh … Yes …like we have never seen before, I’m picking.

      The markets distortions on too many fronts are just too great.

      The grossly irresponsible easy money trends have exacerbated and marked so many structural and political failures.

      • It’s certainly got that feeling to it. Chinese banks, duetsche bank, stock markets running on hopium of fed cuts, car sales, retail, housing turning, developers going under, HK going feral, gold going up when it usually wouldn’t, unprecedented corruption in oz politics. Very interesting times.

      • The Beetrooter Advocate

        These scenarios will perpetuate until the punters scream “Enough!”.

        That’s a long time away. You did see the increased majority the LNP got at the election they weren’t going to win right?

      • Betrooter, the Coalitions primary vote dropped .6% to leave them exactly where they started before the election. Hardly a thumping victory.

        That said, totally agree. Everyone hacks on the French for well, being French. At least they’ll get out and riot. We sit at home and numb ourselves on MAFS and the Block and bitch about why things are fvcked while doing sweet FA about it.

      • Mining BoganMEMBER

        Speaking of the French, where did all of the yellow vesters go during the Tour? Never spotted one except on the three wheeled Niken and I don’t think that counts.

    • how many times do Lendlease pull out of NSW gov deals before we declare a trend? Nothing to see here?

      • In both cases they were the sole bidder. I presume they will simply up their price and then sit there waiting for the NSW govt to cave.

        In addition, I presume the NSW govt was completely incompetent and had not built any protection into the contract from being reamed like this.

  2. SnappedUpSavvyMEMBER

    Who hasn’t been racially profiled? I’ve been negatively racially profiled in Japan, China, Taiwan, South Korea, USA, France, Italy and the list goes on. Why would I make a big deal about it snowflake? FMD
    https://mobile.abc.net.au/news/2019-08-01/alleged-racial-profiling-at-regional-nsw-motel/11300086?pfmredir=sm

    It’s OUR government that’s importing the sex slaves and it’s OUR ABC who should call it out

    give me a break this country is farked

    • TailorTrashMEMBER

      Spent a good part of my life travelling around
      the countries of Asia and have experienced
      racism many times ……the higher the ranks you dealt with the more racist they were … the lower the rank
      the more deferential they were and the more you had to be self aware of your own commonness lest you get head swell . No one ever complained about racism in those days and who the fcuk in China , Korea or Japan would entertain such ideas . Now in multicultural straya it’s easy to score few points against the hosts as they are slowly undermined on all sides . When the majority becomes the minority will racism be discussed ……I doubt it .

  3. The Beetrooter Advocate

    Listening to the anthems now.

    Bunnings really missed a product placement opportunity of the century.
    Brought a tear to my eye.

      • The Beetrooter Advocate

        Well yes. But, seriously, if I was a President up to my elbows in a trade-war, I’d be peeved by an apointee intent on raising rates when the rest of the world isn’t. They had one job, and got it wrong, which is why they had to cut so soon.

    • Has ZH disabled comments? Couple of articles i’ve read recently had no comments. Probably a good move considering the loonpond that was the comment section.