David Llewellyn-Smith

24

Manchurian Dan’s virus spike going “exponential”

Via News: There’s real concern among experts that the spread of COVID-19 in the community in Victoria is about to get a lot worse. Epidemiologist, Professor Adrian Esterman, told news.com.au this morning he is “very worried” about the surge in community acquired cases in particular. Of Victoria’s 77 new cases on Thursday, 31 of those

1

Construction PMI off the bottom

Still contracting at a great pace: It’s funny given construction was never supposed to shut down but clearly some did. Most segments are returning to former downtrends but one is criminally weak: Josh Depressionberg should never have allowed infrastructure to get flushed like this. It was a rookie mistake. Full report.

2

US jobs preview

Via Calculated Risk: On Thursday at 8:30 AM ET, the BLS will release the employment report for June (Friday is a holiday).  The consensus is for an increase of 3.1 million non-farm payroll jobs, and for the unemployment rate to decrease to 12.3%. Last month, the BLS reported 2,509,000 jobs added in May and the

6

Markets are mistaken that Australia is the great post-virus rebounder

Via Bloomie: For an idea of how disparate predictions are for the world’s post-coronavirus rebound, look no further than forecasts for Australia’s dollar. Bulls such as Morgan Stanley see the currency rising to 73 U.S. cents by year-end as the worst of the pandemic eases. At the other end of the spectrum, JPMorgan Chase &

5

Shane Oliver: Beware Biden bust

Via Shane Oliver: Introduction Investor focus on the US election waned earlier this year after socialist Bernie Sanders dropped out of the Democratic primary race in favour of moderate Joe Biden. At the same time coronavirus became the main focus for markets. However, markets may soon start to pay more attention as the election is

1

PMI producer admits PMIs are useless

Via FTAlphaville: It’s confession time for IHS Markit, the firm behind the purchasing managers’ indices. The firm asks thousands of purchasing managers whether activity over the current month has declined, improved, or stayed about the same compared with the previous month. IHS Markit then tallies responses up to produce a net figure where 50 signals no

14

MSM does Sydney rental rout

Unit Rental Vacancies Surge in Inner Sydney over June – Rents Falling. Nine News Reports Exclusively#housingmarkethttps://t.co/QEFHQzkJFB — Andrew Wilson (@DocAndrewWilson) July 1, 2020 There is no end in sight to the deterioration as: eviction and mortgage forbearance ends; foreign students and immigration remain stalled; AirBnB remains busted; the construction pipeline delivers still more supply; high

34

CCP applies Hong Kong security law to Planet Earth

From your friendly neighbourhood tyrannical regime: Oh my god am I reading this right??? Article 38: The law applies to persons who do NOT have permanent resident status in HK and commit crimes under this law OUTSIDE Hong Kong. Did Beijing just grant itself sweeping extraterritoriality to…everyone on the planet? — B. Allen-Ebrahimian (@BethanyAllenEbr) June

81

Murdoch dumps Trump

Via Crikey: Murdoch watchers are about to see in real life how Lachlan handles the dilemma his father regularly faced: how to choose between the political right (in this case, Trump) and the likely political winner (almost certainly not Trump). It’s not just the polls, with averages currently showing Joe Biden up about 10%. It’s

2

Goldman: Stocks enter “bubble territory”

Via Tony Pasquariello, global head of HF Sales at Goldman Sachs The dominant narrative of the week was a return to trading COVID headlines, as the worst period for US case growth since April served as disruption for those expecting business-as-usual trading conditions this summer. Along the way, stock operators absorbed another heavy dose of

9

Gold shines on struggling ASX

The Australian dollar is still trying to push higher this morning. The chart is still bearish: Bonds are stable: Stocks are struggling despite another drunken night on Wall St: Big Iron is OK: Big Gas is struggling: Most of Big Gold is coiled in an ascending triangle pattern looking for break out: Big Banks are

29

Australia/China relations collapse into strategic rivalry

The Australia/China relationship is sliding at astonishing speed towards outright strategic competition. Hong Kong is dead. Sinocism reads the tea leaves: The Hong Kong National Security law has been promulgated and is now in effect. You can read the official versions here in simplified Chinese, here in traditional Chinese and here in English. Some highlights: Chapter III Offences and

2

Aussie PMI bounces into expansion

AIG manufacturing PMI: Remember that PMIs are directional not positional so all this is saying is that conditions got better month on month not that they have returned to pre-pandemic levels. Most of the index appears still crashed. Building materials is a big worry for construction. Not much to celebrate here. Full report.

10

Australian dollar tears roof off with stocks

DXY was softish last night: The Australian dollar rose against everything: Gold put some light between it and the break out: Oil was soft: Dirt mixed: Miners firm: EM stocks weak: Junk better Bonds were soft: Stocks took off for year end: Westpac has the wrap: Event Wrap US infectious disease expert and senior official Fauci told a

21

ScoMo’s double dip depression is coming

Via Damien Boey at Credit Suisse: Loan demand could stabilise, but … New loan approvals are falling in trend terms, foreshadowing weaker growth in the stock of credit in the near term as the back-book of loans catches down to deteriorating flows. However interestingly, our proprietary credit conditions index, which takes into account banks’ willingness to make high loan-to-value ratio

1

Moody’s: Mortgage delinquencies head for GFC highs

Via Moody’s Summary » The 30+ days delinquency rate for prime Australian residential mortgage-backed securities (RMBS) increased to 1.79% in March 2020 from 1.55% in December 2019 and 1.57% in March 2019. » Delinquencies will continue to increase in 2020 because of the economic disruptions caused by the coronavirus outbreak. Delinquencies will continue increasing over