Macro Afternoon

A relatively staid session across risk markets here in Asia today following a small blip higher on Wall Street overnight. Only Chinese stocks are in the red with the Shanghai Composite down a handufl of points to be back below 2900 points while the Hang Seng Index has continued its mild retreat, down 10 points or so to 25654 points. Price remains under pressure below the low moving average on the daily chart, and still looks set to return to the terminal low just below 25000 points:

Japanese share markets have moved slightly higher, only just, as the Yen remained steady throughout the session with the Nikkei 225 closing only 0.1% higher to 20479 points. The USDJPY pair is hovering just below the 106 handle after a very quiet session overnight, not threatening to move any higher until we get more catalysts from Trump and China:

The ASX200 was the best in the region, despite some big headline earnings misses – particularly Virgin – gaining over 0.4% to close at 6500 points even. The Australian dollar helped a little by falling through tentative support at the 67.50 level, now ready to tackle the Monday morning gap low as The City opens:

S&P and Eurostoxx futures are flat, indicating a lack of confidence from last night’s mild session with the S&P500 four hourly chart shows price hovering in the midpoint of the moving average bands, with price unable to get back above the 2880 point level:

The economic calendar continues tonight with a series of Treasury auctions, plus the regular DOE Oil inventory updates.

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Comments

    • … From yesterday …

      A review of things you need to know before you go home on Tuesday; some key rate cuts, house inflation reviving, bank reputations improve, ugly Fonterra drop, swaps firm, NZD stable, & more … Interest Co NZ

      https://www.interest.co.nz/news/101391/review-things-you-need-know-you-go-home-tuesday-some-key-rate-cuts-house-inflation

      … extract …

      $1 BLN LOST IN ONE MONTH

      A feature today in local markets is the continuing sharp fall of the Fonterra share price, now at a seriously worrying $3.15 and a drop of another -8c today alone. Investors are fleeing fast. The company’s capitalisation is now only $5.077 bln and that is $1 bln less in just one month. This is a company that had a capitalisation of $10.7 bln in January 2018. It has halved since then.
      .
      .
      Treasury to be asked about solidness of Fonterra’s financial reporting … Andrea Fox … New Zealand Herald (behind paywall)

      https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12262311

      Google NZ Search ‘Fonterra’

      https://www.google.com/search?source=hp&ei=jOJkXfv2GcL59QPFia2QAw&q=fonterra&oq=fonterra&gs_l=psy-ab.12..

    • TailorTrashMEMBER

      Good article in the pink pages pommie paper ……..(can’t copy it as they have all sorts of restrictions in place )

      ……but

      “The souring of Fonterra’s fortunes — and those of the 10,000 farmer shareholders who own it — marks a dramatic fall from grace that has called the company’s strategy and structure into question.”…….

      ……there you go …strategy and structure ………..all those MBA’s doing stupid sh1t that has nothing to do with milking cows ……….pity the 10,000 farmers dealing with the real sh1t to make the milk are going to get screwed …………..one day we might get it ……..

      • C.M.BurnsMEMBER

        Being a cooperative, don’t the owners / farmers actually have a say in board and executive appointments ?

        If yes, then they have probably voted for some of the ppl based on being promised OTT returns and other “to good to be true” strategies

        • TailorTrashMEMBER

          Do they understand the complexity of what they are voting on ?……..probably not …….(.the same can be said for the owners of sh1t apartments …….they vote on manipulated choices .)……..yes they are silly losers………..voting for unachievable returns ……………but in an older society …a better society a cooperative was a cooperative…..not so brutal and manipulated………..it’s not so simple as a vote ……….

          • Fonterra is heading down the same road as Murray Goulburn Co-op which followed Bonlac Foods courtesy of the wonderful Phil Scanlon into oblivion. Bega although now PL Co, will be lucky to escape same fate.

            The rationale for having processing co-operatives is past. Once they start talking value added, the rot starts. Also corporatisation with “professional” highly paid managers does not help.

    • The Traveling Wilbur

      I am slightly surprised that no one has gone with the obvious headline here. Very unjournalistic.

      750 virgin employees to be screwed by employer.

      • Yes, Nik. Expensive, salaried jobs, that’lll never come back. For every wage gone, expect another 1 or 2 multiplier

        Early signs of recession everywhere

  1. “There’s a good chance that the AUD will be more heavily beaten up as London comes in later this afternoon. It often has a much better grasp of macro drivers than Asian markets do.”

    Nope fvckn poms bidding it up. Sigh.

  2. ErmingtonPlumbing

    Anyone listen to Sally Rugg on the Drum tonight.
    Vomitus stuff.
    Went on and on and on about herself and then ended with “it’s not about me” lol
    It was almost funny.

      • Watched that this arvo. I really don’t know what to think with world politics these days. It certainly seems the worlds elite are really just taking the piss at the moment. It’s like a tangled web of rich cvnts all vying to screw their own people as much as they can.

    • I watched her. Basically took the credit for the marriage equality vote and then said how disappointing it was that lib pollies we’re taking a victory lap but did nothing. All I could think of was pot and kettle.

  3. You were warned Hugh ….

    Floods cause more deaths and property damage in the United States than any other type of natural disaster. As climate change accelerates, they are getting worse and a growing number of Americans are signing up to have local governments “buy out” their disaster-prone houses, often with money from grants awarded by the Federal Emergency Management Agency.

    Among cities with populations over 500,000, Houston leads the pack on buyouts made possible with FEMA funds. Harris County, home to the Houston metro area, has bought nearly 2,400 homes as of this past June. Next on the list were Nashville, Charlotte, and Louisville — but Houston has bought thousands more houses than each of the runners up. FEMA calls these transactions a “win-win” because they rescue distressed homeowners and allow oft-waterlogged residences to be knocked down and converted into wetlands, prairies, and other rain-absorbing infrastructure. – read on …

    https://www.nakedcapitalism.com/2019/08/flood-the-market.html

    • ErmingtonPlumbing

      Who needs a post war reconstruction boom to kick start the economy when we got a Post Climate change reconstruction boom coming.
      Cashink! Cashink!

      • China PlateMEMBER

        Punctuated equilibrium.
        It moves slowly and then bang comes on all of a sudden. This sets precedence with all and sundry having their hands out in the future looking for a buy back

  4. Top notch duplicity 3 hours ago.

    India Considers Ending Ban on Foreign Investment in Coal Mining

    https://www.bloomberg.com/news/articles/2019-08-28/india-is-said-to-mull-backing-foreign-investment-in-coal-mining

    So, an unlimited number of foreigners are allowed to come here and buy everything from houses to ports to farms.

    But Aussies are not allowed to own any land over there. Well done fake Greens. Trump is the first president in decades to put in reciprocal import taxes.

    • Lenny Hayes for PMMEMBER

      The article states that foreign investment will be allowed ??.

      I doubt that will have any impact though, the money investing in an Indian coal mine would go up in flames quicker than an apartment in Sydney/Melbourne.

  5. C.M.BurnsMEMBER

    Some interesting commentary and perspectives coming out about the ongoing dumpster fire that is Caltex financial results. A quote from the link below caught my eye:

    “”And this is where pricing transparency should be highlighted. Buyers are increasingly price sensitive and they are shopping around to save a few cents per litre of petrol and this means the Industry’s ability to over-earn is over.””

    https://www.livewiremarkets.com/wires/caltex-oils-ain-t-oils

  6. I think I am going to regret this but yesterday I thought SBM will go further down so I can buy at close to $3 when was trading at $3.10. Today I could have bought at $3.25.. Same for SAR i thought I can buy more at below 3.60 but I should have bought at $3.65/6.
    And AMI w=should have bought at 51c few days ago.. this one completely ran away from me.

    I get the feeling gold is about to go off on some news that something somewhere broke and the world is about to end. Hope I am wrong but it just feels that everyone is awaiting on some bad news in order to start to panic. I’ve never seen and heard so much negativity from down to earth analysts and so much full steam spruiking from MSM.

    • I started following economic news in 2006 when I moved to Perth after 6 years living in the far north of oz and not knowing wtf was going on outside of my job life. When I got to Perth I wondered WTF was going on with the insane house prices. So I started reading non MSM news and forums to try and get a grasp. What it feels like now is very similar to the lead up to the GFC. We all know it’s going to turn to sh1t, it’s just waiting for the catalyst and who is going to get fvcked harder.

      • I was completely novice when I moved to Ireland in 2007, I saw a bank run in Dublin (Northern Rock) and thought very little of it at the time. Then the subprime bubble blew in 08′ and I was insulated in a good job I enjoyed and didn’t think much of it. I returned to Australia in 2010 and couldn’t believe the living costs by comparison and the cost of housing with it!

        Then I watched it all go crazy further after that, I knew it was a bubble and tried to buy a few places, but every auction I’d go to prices went way above guide range and I kept having to look at suburbs I never even would consider before and on and on it went.. then I discovered MB with all the other shut ins haha.

        But I’ve never seen the Economic news this bad in my lifetime, now granted I didn’t watch it the same back in 2007/8 it feels like a totally different world now to 10 years ago. Everything seems to be breaking, all at record low interest rates. We’re seeing a rise in populism due to increased inequality thanks to QE.

        I don’t know how this will end, but part of me thinks it could be like the 1920s and the Great Depression…but I hope not.

  7. From AFR:
    “Telstra filed notice on Wednesday that CEO Andy Penn had lost some 823,210 performance rights issued to him under his FY17 long-term incentive plan, based on unmet performance to June 30.

    At least he’s got that 34 per cent pay bump with which to drown his sorrows.”

    So you miss your target but still end up with 34% rise. fck me.

  8. TailorTrashMEMBER

    Jeez this site is kicking up some bad stuff at the moment ……can’t reply …..and some responses way off the screen ….,,,,,hope the chaps are using totally ethically sourced programming resources and it’s not outsourced to Manila or Bangalore .