Macro Afternoon

See the latest Australian dollar analysis here:

Macro Afternoon

Almost a full sea of red across Asian share markets as the souring risk sentiment on Wall Street overnight spreads to most risk markets, although China is holding up well despite its latest PMI reading. The USD is continuing its surge in strength against most of the undollars, with the Australian dollar putting in some volatility on the latest jobs vacancy data, while oil prices are trying to stabilise with Brent crude barely holding to the $112USD per barrel level. Meanwhile gold is about to rollover below keep support levels as it struggles to keep the biggest bears away, depressed and ready to breakdown below the $1820USD per ounce level:

Mainland Chinese share markets are standing out by doing quite well as the Shanghai Composite is up more than 1.4% to 3403 points while the Hang Seng Index is putting in a scratch session, down just 0.3%, currently at 21935 points. Japanese stock markets however are feeling the heat, with the Nikkei 225 index closing 1.5% lower at 26393 points while the USDJPY pair has retraced slightly to be just above the 136 handle, still rejected last weeks high:

Australian stocks couldn’t escape the selling with the ASX200 finishing more than 1.9% lower, closing at exactly 6568 points. The Australian dollar got a bit volatile around today’s economic figures, but have returned to where they started this morning,heading towards the previous weekly low at the 68.80 level:

Eurostoxx and Wall Street futures are heading down sharply as we head into the European open, with the S&P500 four hourly futures chart showing price action now fully below the previous resistance level, with momentum clearly negative and ready to break lower:

The economic calendar includes two very important prints tonight, namely German unemployment and then US core PCE numbers.

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Comments

    • The Travelling PhantomMEMBER

      It’s in the fixed rates future loans, but it’ll be serious if they increase even just 0.25% on their variable out of cycle

    • innocent bystander

      raising fixed rates just means they don’t want that business.
      they actually lowered their variable – for new customers with 30% deposit; that’s the kind of business they want.

      • Those are prudent borrowers. They aren’t getting those just yet.
        They still need to ban the use of existing equity as deposits for next purchase. Or really refinancing to cash out equerry for another purchase needs to die first

        • drsmithyMEMBER

          The law should be changed so it triggers a CGT event.

          A mystery why it doesn’t already (actually not that surprising I guess – isn’t borrowing cash against the value of assets one of the ways Properly Rich people access their paper wealth ?).

      • This is a big move. Seems like a flight to quality/lower risk borrowers that will reduce their lending vols. Do you think CBA are driving this themselves or are they being by APRA directed behind the scenes to reduce risk given their Pandemic mortgage binge?

        Could Judo bank exiting the market be more evidence that APRA is battening down the hatches before the storm?

  1. Ireland is in the middle of another significant housing crisis.
    New Zealand has a structural housing shortage across many metrics ,which the recent building boom does not dent. The RBNZ raising the OCR will only adversely affect the increase in supply of dwellings. In an update today New Zealand has announced that the uptake in applications for its one- off residence visa has now exceeded 200000, 40000 above initial estimates,,or the equivalent of 1.1 million newly minted Australians.

  2. innocent bystander

    must be a bear market if the window dressers didn’t turn up for work on the last day of the FY?

    • The Traveling Wilbur

      Yep. And what do we want?

      MOAR BEAR Action.

      PS I wouldn’t Google that.

    • Australia can’t build nuclear subs. We lack the industrial base to do it. Full stop.

      • TailorTrashMEMBER

        Yes indeed ……but we can we run the coffee machines in the American officers mess …..

    • Grand Funk RailroadMEMBER

      In the UK case it has been spectacularly obvious, and remains so. But you will find significant Oligarch presence in

      Germany, Holland, Austria, Italy and Spain.

      When I was a journalist there I briefed one of them trying to list part of his company on the London Stock Exchange. The people organising the float wanted someone to run him past the type of thinking he would encounter with the ‘western’ press. This guy had allegedly murdered some other putative Oligarchs people at one point.

      We had a lengthy chat over a feed one time and he got me out to his abode in the outer burbs of Moscow for a follow up. I was very blunt with him and told him straight out he would get questions about any potential known involvement in any criminal activity. We had already discovered that we both liked the original Bladerunner film, and both happened to know large slabs of it off by heart. Anyway at one point I started off questions of the type he could face from anyone who sussed out his background, ‘Mr X it is reported in the Russian media that you have personally been involved gun battles with rival claimants to parts of your business holding. Could you comment on any potential risk for investors buying into your London placement?’

      As cool as a cucumber he smiled at me and replied in Roy Batty style ‘Nothing the God of Business visas wouldnt let me into Heaven for…….’ and pulled a UK passport out of his desk.

      For sure it was a laugh, but it was also uncomfortably surreal, because the passport was real.

      Another mate was the banking analyst for a major investment house in Moscow. He told me about the rumours of how both the large State backed bank and the National financial regulators had identified something suss about the funds disbursement and loan approval process for the Bank of Moscow (then a separate retail bank connected with the City of Moscow) and the activities of the CEO. They had concerns enough to have representatives on the same floor and alongside the offices of the CEO, and representation on the Board, but couldnt find anything.

      Within days the CEO had vanished and of course holes were found in the Bank balance sheets. A 7 Billion dollar hole from memory. What the guy would do was instruct one of the secretaries from outside his office to go and have a coffee, and then log into her computer with a completely separate Login, and organise the dispersal of loans from her desk, and a lot of loan approval documentation was found to be without signatures as well from memory.

      Google the name Borodin

      Someone of the same name rocked up in the UK with his Mrs doing full page spreads of the palace they bought in Oxfordshire, and I was told he became a very large contributor to the Conservative Party.

      But it wont just be the UK, I have seen extensive documentation pointing to Swiss Nationals involved in very major corruption in Russia as well, as well as the other countries above. It also wont be just Russia, with Ukraine probably a larger per capita funder of some dodgy money in Western Europe.

  3. haroldusMEMBER

    I don’t want to put the mockers on them, but Greeny and Careyey are putting on a sweet little partnership, after koala ran out smudgey.

    • Channel 10 made BBL, and cricket, an enjoyable thing to have on the box after work. Channel 7 took the good work and wrecked it. At the same time, Cricket Australia wanted to say they sold the rights for a billion dollars, so they went with the 7 bid instead of accepting 10’s 900 million.

      Channel 7 and CA both stuffed up. They wanted the glory and were pretending that cricket was still a prestige item instead of what it really was, a sickly child that needed some TLC and time with the quirky uncles and aunties while it gets its self back in good health.

  4. Ann Stevenson-Yang
    “China going to spew deflation into the world, maybe as soon as 3rd qtr”
    just now on The Business

    edit; “Australia has had a crack high ever since the GFC thanks to their stimulus” 😂 she’s calling a recession in China

    • Qantas staff are recommending to their nearest and dearest to not travel with them for the next few months. They are hiring again and the training is slow because most of who they laid off want nothing to do with them. Expect lost luggage, delays and cancel for a while yet.

      • drsmithyMEMBER

        We are (finally) heading over to NZ in September and the departing flight is BNE-SYD-ZQN w/QF. I must confess I’m becoming more and more concerned something is going to go wrong with either the connection through Sydney, or our luggage.

        At least it looks like we no longer need to pay for a COVID test before departure.