Macro Afternoon

See the latest Australian dollar analysis here:

Macro Afternoon

A much better day for share markets here in Asia with a minor rebound following yesterday’s big selloff across the region.  The RBA meeting resulted in a hold and small blip higher for the depressed Australian dollar, while Yen continued to selloff giving domestic Japanese stocks a lift.

The Shanghai Composite stabilised a little, lifting about 0.6% going into the close at 2763 points. The Hang Seng Index is doing the best, up nearly 1.2% to 26670 points, with price bouncing off the December lows, but this has all the hallmark of dead cat bounce:

Japanese share markets are clawing their way back with the Nikkei 225 closing 0.4% higher at 23064 points, just slightly above its recent monthly low. The USDJPY pair is slowing rising higher in a typical swing play with lots of resistance at the 109 level above:

The ASX200 was the relative loser in the region, gaining only 0.3%, still remaining under 7000 points to close at 6948. The Australian dollar bounced off the bottom formed at or around the 67 handle with the RBA hold resulting in a 30 pip move higher. This is not that remarkable and could presage a swing up to trailing ATR resistance, but with commodities under a lot of buying pressure, probably temporary:

Eurostoxx and S&P futures are gaining strength with the four hourly chart of the S&P500 indicating another swing move higher tonight as the market wants to get back to the 3300 point level:

The economic calendar is relatively quiet tonight – apart from the State of the Union “speech” – plus some final figures for US durable goods and factory orders.

Latest posts by Chris Becker (see all)

Comments

  1. All these years I’ve been blaming Neoliberalism/Globalisation for the demise of Australia’s industry. Little did I know just how it was achieved until a chance chat with an interesting old mover & shaker today…… I was quizzing him about Kit Cars & ICV’s (& the death of). It quickly went sideways into a rant about the state of our trippy bureaucracy where there’s now No technical expertise to make common sense decisions – or decisions at all, & how & why Australia’s industry went OS – that I’ve spent a lot of my life in manufacturing helped the flow…. but it was like talking to a fellow MBer in so many ways….. Eyes open & frustrated!

    Anyone interested can look up the Lima Declaration.
    The Lima Declaration and Plan of Action calls for the redistribution of world industry so that developing countries would have 25% of it by the year 2000. To achieve this, radical changes in traditional concepts and practices are recommended. Economic growth in poorer countries could no longer be seen as the “trickle down” benefit of growth in rich countries. To close the gap between richa nd poor nations the developing countries would have to grow faster than the developed countries. With this end in mind, the Lima Declaration sets out the “main principles of industrialisation” and defines the “means by which the international community as a whole might take broad action to establish a New International Economic Order”.

    Sold out before I was in High school, but not directed elsewhere by my careers advisor…….

    • That declaration is just touchy-feely boilerplate cr*p rationalization in case the stupid masses start asking questions about the rapin’ it was decided they were going to get long time ago.

    • Arthur Schopenhauer

      “there’s now no technical expertise to make common sense decisions”

      Even in the basic city construction, like road building.

    • Neothingy is a nothing burger, a distraction of blame, the colour of choice of the getaway car.
      Lenin wanted to disperse centralised manufacturing in biggest cities to the peasants in the vast lands. Stalin had the job of overseeing this. Fortunately for Russia this preparation helped them to win the war by the time the 1940’s rolled up, their industrialisation capability was phenomenal.

      Lima Declaration – it all fits.

      • I’ve been test riding a few road bikes, but they just don’t rip my arms out like the motorcrossers used to even though they’re faster…. I could buy one of the few registerable CR500’s & scare myself silly, but they’re not cheap for an old bike & too high for my short arse….. So I started looking at clubmans etc & come across a mid/rear 3L v6 Supercharged beastie that’d be something else, 300kw/720kg – https://www.notasportscars.com – Nota F1…. Mmmm. He’ll build it, but it can’t be registered in NSW at this time – some other states maybe? Maybe not for long, it’s a dying game. A lot of ICV builders are giving up & selling their now worthless moulds, jigs etc out of frustration with the clowns at the RTA! That means more business, jobs & knowledge sacrificed for the idiocracy. There should be many blooming cottage industries, but not while the big boys dictate to a clueless bureaucracy…… That bloke taught me more about car engineering & preferred specs etc in 1hr than I’ve learned in some time. Worked with all the names from the 50’s on in F1 testing, driving, designing. All I want is a Ford rs200 knockoff, although he reckons the front drives a waste, he admits AWD might help lower skilled drivers catch it easier with their bigger handling sweet spot (me!), but there’s a weight penalty – which I’m willing to sacrifice.

        • I know mate, I agree re: cottage industries… a book I can recommend is by Gordon Dobbie called racing for fun.
          https://www.facebook.com/HeritageDatsunRacingAustralia/posts/-racing-for-fun-by-gordon-dobie-purchasing-info-below-so-the-k-made-it-to-the-bo/844151702405922/
          He talks about early days of racing at Albert Park and what it was like back then. Real grass roots stuff. Makes me nostalgic for a time I wasn’t around.

          In terms of bikes I had a license a few years ago. I was gonna build a cafe racer. I’m kind of into the artistic side of it more so than riding at speeds that would turn me into pulp if I hit something. Now that I’m gonna be a father need to consider repercussions of coming off a bike. An Austrian bloke I used to play soccer with in Ireland hit some black ice 1 night and died. His son was 14 at the time. He would now be 20-21 years of age. Makes me feel sad.

          But I agree all the rules have killed the car modifying scene in NSW and Victoria isn’t far behind. It’s BS, a lot of amazing skills and talents outlawed. We could have cool little hot rod shops etc.. I know Castlemaine is meant to be good for it, hence why I considered moving out there. But you’re really swimming against the current in this country. Sadly.

          • Yeah I can’t stand West Melbourne, my sister lives in Keilor Downs, I just don’t get that part of the country, but go further out towards Calder Park, and then Sunbury and onto Kyneton, Bendigo and Castlemaine etc.. love that part of the world.

  2. “Three private flights from China touch down in NZ…”
    New Zealand officials are on to it!
    “Air Center One chief executive Rob Leach said ….the travel ban was over the top as his clientele would not be spending time in areas like the Wuhan meat market where the virus was believed to have originated. “The [infection] threat level of somebody coming in on these aircraft is very low.”
    Sigh….

      • So, Dutton’s the challenger from the conservative side. Who’s the contender from the centre, centre-left? Noting that no Lib PM has come from anywhere except NSW/VIC. Joshie? Ghunt? Talent is thin on the ground in the House. Porter probably most impressive but wrong state.

    • By Jove, isn’t The Beetrooter colouring up nicely? A little more and the Akubra will be skywards at pace.
      We are consistently amazed by our pollies, I know, but, to the ordinary bloke it is inconceivable, beyond belief, that this prawn could have got anywhere near a ballot. Tamworth, Armidale didn’t look like the cuckoo’s nest last time I went past.

    • Barnaby will get there then watch Dutton. The Libs need three quarters of the caucus to vote against ScoWu and he’s cooked. Won’t happen immediately but with ScoWu fvcking up everything he touches it’s ba matter of time before they turn.

      • happy valleyMEMBER

        As high as Scotty from Marketing made it (v. Labor), I think the spill motion threshold is two-thirds – not three-quarters?

  3. Someone posted this yesterday and while it hasn’t been peer reviewed yet and its a small sample their discussion is interesting. They think that asian men have 5 times more ace2 receptors than white or black men, and the virus binds to these receptors. I haven’t heard of a case which has infected a whitey or african yet in the west, i thought by now we would have started seeing cases pop up. Any thoughts?
    https://www.biorxiv.org/content/10.1101/2020.01.26.919985v1.full#disqus_thread

    • “ A British man living in Wuhan has told how he recovered from the virus and plans to stay in the Chinese city.
      Teacher Connor Reed, 25, from Llandudno in north Wales, contracted the virus last December but initially thought it was a cold.
      “It sounded like I was breathing through a paper bag. And it was at that point that I thought, OK this is serious,” he told BBC Radio 4’s PM programme.”

      https://www.bbc.com/news/uk-51358742

      Whiteys included

    • Doesn’t bode well for much of the west. “Upregulation of ACE2 expression and function is increasingly recognized as a potential therapeutic strategy in hypertension and cardiovascular disease, diabetes, lung injury, and fibrotic disorders.

    • “the distribution of ACE2 is also more widespread in male donors than females”

      The man flu is real.

    • Mining BoganMEMBER

      Righto then, I’ll go along with that straight after China compensates Australia for dropping a deadly virus in our midst.

      • Ronin8317MEMBER

        The Chinese health workersin Wuhan told the higher up that there is a potential epidemic at the end of December. The higher up tired to cover it up and arrestef people who mentioned it in social media. They did close down the seafood market, but didn’t warn people who went there about potential infections.

        For the Chinese government to screw up this badly and demand compensation from the rest of the world requires a total lack of shame.

      • And as soon as they compensate for trillions of dollars of IP theft, ignoring WTO rules around imports and de-industrialising the West and causing the GFC through their insane rigged exchange rate.
        $100 trillion in US dollars should almost cover it.

    • SnappedUpSavvyMEMBER

      Chynas reputation is getting smashed, had a meeting with a company today, they want every thing pulled out of chyna and made here, music to my ears 😁

      • Wait until they find out how long and how expensive it is going to be and watch them reassess their options and continue on the path they are on now…

    • More spoiled toddler behaviour from the Chinese government in order to manipulate it’s providers (and superiors – in every aspect of the word when comparing China to the west). These poor ignorant spokespeople don’t even realise the damage they are causing to their country and its reputation by their words. The world has already long not trusted China and Chinese products still are viewed as inferior quality and/or unreliable. China got where it is today by undercutting, copying, cutting corners and doing cheaper. It’s an unsustainable mess. Additionally, the culture and people are disgusting, vulgar and dishonest. The rest of the world is gradually pushing back and increasing its repugnance for all that is China.

    • My own theory is that, aeons ago, intergalactic travellers, an unusual breed never seen before, devoid of social manners and etiquette, were inexplicably forced to abandon their planned flightpath and to take refuge on Earth as a last resort. Had they landed and remained isolated on, say, Galapagos, they may have remained a source of curiosity and observation for us all, not just Sir David Attenborough. But they landed on a Dog-forsaken mass of land known as Ch*na and took it for their own. Like huntsman spiders, they had about 300 offspring at a time until their Dog said you can only have one. But, by this time it was too late – they had multiplied by the squillion, divided the planet, subtracted from the quality of life and the numbers of dogs and added to the quantity of sputum in the streets. And Dog has changed his mind as well – keep proliferating, we need to fill all those empty buildings and those bloody islands that keep popping up everywhere. By the way, Dog hasn’t been seen for a while. I don’t think it’s true that he’s been seen busking in Eastwood Mall.

  4. TailorTrashMEMBER

    Another TV created upstart cook enriching himself on the back of the lowest paid and most desperate in our (used to be ) society .

    I have an idea for a new reality show …….CELEBRITY THIEFT…………….the objective is to see who can steal the most from the poorest and most vulnerable….
    …….bonus points if you invest the proceeds in Strayan property ………

    The panel of judges will include Highrise Harry, Reusa ……..and any member of the House of Representatives or the senate…………

    Getitintaya straya !

    http://www.abc.net.au/news/2020-02-04/dinner-by-heston-underpaid-staff-by-more-than-4-million-dollars/11928746

  5. ErmingtonPlumbingMEMBER

    Thomas Nykirk
    February 4, 2020 at 1:07 pm

    “Ray is currently quarantined at home in Beijing. She is angry with the Australian Government and … her worst fear is being told she must defer her studies.”

    Her worst fear should be that she could kill local Australians by infecting them with her virus.

    She basically wants the option to murder Australians in order not to be inconvenienced. This is the epitome of Chinese racism to Australians.

    • That sounds suspiciously like Plumbing Privilege.
      I just made that up but it could become a real, ill-defined unarguable thing that means whatever I want it to mean.

    • She should be angry at her culture for eating raw bats and other things that ought not be consumed, or angry at Beijing for a haphazard approach to China’s bio-weapons research.

      And the rest of the world is going to be very angry at China before this is over.

      I was at Bunnings today buying a few things in case the worst eventuates. Chinese everywhere lamenting that the shelves are empty of N95 masks. I don’t think a N95 mask is much use. But the Chinese seem to have an appreciation of what may be coming to Australia.

        • DISCLAIMER – there are all educated guesses I have made and do not constitute advice. Further, these can only be considered risk-minimisation (100& risk elimination is impossible).

          1. Most resp infections are spread by droplets or aerosol (cough, sneeze) that you come in contact with, or by contact (you touch a surface and then though your eyes / nose / mouth). Eyes are an important route – someone sneezes, aerosol drops hit your eyes, you blink, and it is in your nose (bypassing any mask). Several workers in Wuhan got infected despite N95, and believe they got hit in the eyes. Hands are good at transmitting viruses between surfaces.
          2. Corona lives on surfaces for upto 28 days = there until it is cleaned.
          3. Resp infections are generally not transmitted by the airborne route (i.e. you do not usually get a resp infection simply by breathing air in which the virus is floating). If Corona was widely airborne, things would be much worse than they are. So my guess is that airborne is not the major risk (although it is early days, and this strain could be different).
          4. Corona is a resp infection and the above likely holds.
          5. N95 masks (= P2). The ‘N95’ designation means that when subjected to careful testing, the respirator blocks at least 95 percent of very small (0.3 micron) test particles. But this is under ideal conditions – which most users will not achieve without training. No facial hair. Most people find breathing through a N95 is difficult due to resistance – which over time can lead to loose and ineffective fitting.
          6. Protection has to be disposable, or cleanable. There is no point using the same contaminated goggles.

          So, I have gone with the following layered approach
          Safety goggles with a seal, hence no gap around loose fitting glasses.
          Normal masks – will stop large droplets, and will stop you unconsciously touching nose / mouth
          Face shield as a first line of defence in certain situations. Like a gardener may wear to protect their face. Something like this:
          https://www.google.com.au/shopping/product/7031719420033932824?lsf=seller:100794174,store:8274679485882020900&prds=oid:4502071747300127662&q=bunnings, face shield&hl=en&ei=cmE5XqvrF8TIyAPygrR4&lsft=gclid:CjwKCAiAyeTxBRBvEiwAuM8dnV9zq336S3NHq3nJaIysWl1OGFAQQ7xKjVW_XF_wO81D_GtzJeUpzhoCdFcQAvD_BwE,gclsrc:aw.ds
          Lots and lots of alcohol based hand wash. Litres of the stuff. Must be at least 60% and preferably 70% alcohol. Use whenever touch a high risk surface. Wash hands before entering home to minimise contamination of surfaces where you spend a lot of time.

  6. “Ray is currently quarantined at home in Beijing. She is angry with the Australian Government and … her worst fear is being told she must defer her studies.”

    That is about to be the very least of Ray’s fears.

  7. Talk on the web is that all media is suppressing all talk on coronavirus world wide.
    I felt this mid last week.Any thoughts?
    Has anyone checked their food whilst shopping?
    I came home today, and checked country of origin, from a shop at Aldi’s.
    Bought 24 jars of miced garlic, made in China, 12 cans of Fruit Salad in cans same…best I check packed on date…
    Any others here checking??

    • TailorTrashMEMBER

      We Chinese …we no speak English ….we need degree …we no care for you …we DEMAND you give us degree …….Australia belong us …….

      Please comply with the relevant laws to ensure compliance with our needs forthwith

      Xi fook Xu
      Chairman
      Australian chapter Deng Xaioping hide your strength and bide your time foundation

    • Local Coles (regional NSW) has signs up about shortness of sanitiser products (yes, I know it’s anti bacterial), but, in an area with no notable Chinese population or tourism , interesting. Masks all gone from 3 major bunnings too. People are prepping it seems.