ASX bath of blood returns with second virus wave

The Australian dollar is still under pressure this morning:

Bonds are bid:

XJO is bleeding once more:

Big Iron is down modestly:

Big Gas more:

And Big Gold is soft:

Big Banks do not look well:

While Big Chunt has kept the dream alive:

At issue is the so-called virus “second wave”. LA county locked down for three months last night and US chief medical officer, Anthony Fauci, warned everyone to stay shut. Germany saw bigger case numbers. Emerging markets are awash with the virus. China has seen more cases as well.

It’s not the second wave at all of course. The first wave never ended. But you can’t get the priced v-shape recovery if major US states remain locked down until August.

As well, the US senate proposed the COVID-19 Accountability Act, complete with sanctions, which sounds rather ominous, and El Trumpo banned public super from investing in China.

S&P futures have awoken with a start:

The market needs some MOAR!

David Llewellyn-Smith


    • lol

      Buy the dip?

      I have to say that the sideways action in USD gold makes me nervous…good for consolidation after a big run-up, but it feels like it could lurch down to $1650 or lurch upwards past $1730…

      There seems to be a battle around $1700.

      I’ve got cash, and don’t know what to do with it! (which probably means ‘do nothing’, and stay in AUD cash…)

      • Denis413MEMBER

        Gold historically runs in H2. The trend is pointing to negative rates – gold did well in that environment a few years ago, it will do well in the future also.

        • Saw an interesting article pointing out gold moves inversely to US real yields. Ie yields down, gold up. Because higher yields make gold (which doesn’t yield) less attractive.

          So if rates are going negative, yep buy gold. But what if bonds are in a bubble? The opposite.

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