Macro Afternoon

See the latest Australian dollar analysis here:

Macro Afternoon

The return of Japanese traders and a still upbeat Wall Street saw most Asian stock markets advance, with the major macro event being the RBNZ holding their cash rate and the New Hampshire primary in the USA. Gold is slipping while Bitcoin breached $10K again, with Yen buying moderating and helping buoy the re-opening of Japanese stock markets.

The Shanghai Composite is up 0.65% after the long lunch break, advancing past the 2900 point barrier to be currently at 2920 points. Meanwhile the Hang Seng Index has pushed higher after its own previous big advance, up 1% to 27854 points. Price broke out above the high moving average level and is barrelling in on the 28000 point level where its sure to find resistance, with momentum still not yet positive on the daily chart:

Japanese share markets reopened with the Nikkei 225 lifting 0.5% to 23800 points even, not helped nor hindered by a steady trade in Yen, with the USDJPY pair remaining just below the 110 level. A minor breakout overnight above the high moving average went nowhere and the tight band of trading is setting up for more breakouts – or downs – soon:

The ASX200 had another solid session, this time moving 0.5% higher to 7088 points, despite a higher Australian dollar that continues to bounce off oversold levels and remains above the 67 handle – but for how long:

Eurostoxx and S&P futures are up slightly with the good mood translating to some gains later tonight. The four hourly chart of the S&P500 shows price bunching up at the 3370 point level, geting ready for another breakout and yet another new record high:

The economic calendar includes Fed chair Powell testifiying before the broken US Senate, then the latest DOE oil inventory report.

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Comments

  1. So looks like our media as well as chin as is downplaying the CoV to the max lately. New cases are dropping, barely any new cases in the west for a week now, all is good it seems. Soon chin as factories will reopen and the planes will start flying and we will really see what this CoV will do to the world and if there is a deliberate mass culling. Interesting times indeed.

    • I get the feeling that lump under the carpet will be able to be seen from space. Is China burying the evidence so they look good and can start the export train again ? Losing face versus ………

    • I’ve heard this 1000x. Hope your correct but either way I am prepared in many ways while many others believe everything they see and are not prepared at all. Good luck

        • well its a hospital. so.. there’s that. the original context I saw this am was they were running out of bags, and the poster was clear this was not flu related. also the flu bags are yellow hazmat.

  2. Phillip Coorey:

    Nationals put ‘coal’ in Coalition

    Three weeks ago, Mr Morrison used a year-opening address to anoint gas as the transition fuel

    Writing in The Australian Financial Review, Energy Minister Angus Taylor reaffirmed the gas transition plan

    Senator Canavan dismissed Mr Morrison’s gas call.

    “In north Queensland, particularly Collinsville, there is no gas, there is not going to be a solution that protects manufacturing jobs in Townsville and Mount Isa involving affordable gas.”

    https://www.afr.com/politics/federal/nationals-put-coal-in-coalition-20200211-p53zky

      • I see this sentiment a lot here. But, what choice do we have? LNP suck anoos, have had a long time to prove otherwise and still suck. It’s all well and good to have a sad that we don’t have better, but any vote that isn’t for LNP or ALP is a wasted vote (don’t blame me, that’s the way it is, Sustainable Australia are never gnna swing enough votes). How bad could it be if we all voted ALP while still trying to start something better?

    • Victorian Trades Hall Council legal centre boss Oanh Tran said she’s worried for Made Establishment staff on temporary visas.

      “Now, not only have they lost their jobs, they have potentially lost the ability to remain in Australia,” Ms Tran told AAP.

      “There are going to be at least some – and probably many – who are in that really vulnerable position.”

    • Bit of annecdata:
      Mum and dad live in Caloundra, Sunshine Coast Qld. Major local employer is tourism, bulk of residents commute to Brisbane for white collar jobs. Youth unemployment is pushing all time highs as local tourism suffers. Local university is flush with foreign students.

      point of the story:
      Mum and Dad decide to be adventurous and go for birthday lunch at the newest of several unnecessary “local taverns” in the new highway adjacent vibrant slum of Baringa. The waitress taking the order is Chinese, does not speak English, and ordering must be completed by pointing at menu items. This was on a quiet Tuesday, in a town that has numerous unemployed super experienced waitstaff that we know personally. I could just barely tolerate this occuring at a super busy time and the individual being auxiliary staff, but this is ridiculous.

      • My folks live in Caloundra too, gods waiting room AKA Golden Beach. That place has exploded in the 20 years they’ve been there, its ground zero for the spillover of legacy Aussies as vibrants takeover large swathes of the capital cities. Used to be a retirement place for rural Qlders.

      • Far too many cafes here (Brisbane) are smashing the visa rorts system. At best they have aussie kids on the till/making coffee or serving, but kitchen is indian/asian. I generally will avoid going back to them. Pubs seem to be bad – even the trendy fancy ones still will have a visa chef making your chicken kaaraage burger in the kitchen while the hipster strokes his c0ck over the flavours of your IPA

        Thankfully a my local ‘regular’ (I go there 3-4 times a year at best) is full of locals and they seem to employ young people and give them a go.

  3. I have been thinking about the move in markets lately and it got me thinking the Fed has lost control. The markets started stumbling when interest rates went up and QE was unwound.

    In Straya RC restricted credit and lead to housing turning down, but also banks started to nudge rates up. Then Fed lost their nerve and lowered rates, QE started again and since then markets went full retard or advance …. Which means fed can never raise and must continue QE forever. At what point will it all break is the question?

    • when IRs hit zero and FED balance sh1t expands another 50% from here? USD will collapse at point. Look at price of gold. Normally when markets boom price of gold goes down. This time around it is not moving or creeping up slowly.
      Just a guess.