Australian Shares

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Chart of the Day: Gold is running out of time?

Today’s chart comes from the McClellan Market Report (via Pragmatic Capitalism) and implies that the secular bull market in gold has several more years of outperformance over the equity market. Using this Dow Jones to Gold ratio, the previous two secular bull markets where gold dominated were of 13 to 14 years duration and occurred

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Trading Day

The S&P/ASX 200 Index closed down 81 points or nearly 2% lower to 4177 points today. In after hours trading, the index has slipped slightly, with Euro markets pointing to lower opens. Asian markets followed suit, with Japan’s Nikkei 225 down 1% to 8392 points, the Hang Seng losing 1.93% to 18455 and the Shanghai

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Trading Day

The S&P/ASX 200 Index closed up 10 points or 0.25% higher to 4258 points today. In after hours trading, the index is down a 13 points, with Euro and US markets pointing to mixed opens. Asian markets had a mixed day, with Japan’s Nikkei 225 up slightly by 0.19% to 8479 points, the Hang Seng

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Think positive

Amidst the deepening market gloom, Deutsche Bank is trying to inject some optimism. It is certainly an interesting inflection point. This kind of fear is different in that it is not fear of “normal” recession, it is fear that the system itself is fundmanetally broken. The GFC is rolling on, in other words. This fear

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Margin lending collapses

The Reserve Bank of Australia (RBA) released the September 2011 margin lending statistics (D10) today (but have not released household finance data (B21), which was scheduled at the same time). I’ve covered this data previously, as it is one of the sub-factors in my macro model for the Australian share market, as I explained then:

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Trading Day: slipping away…

The S&P/ASX 200 Index closed down 38 points or 0.9% lower to 4247 points today. In after hours trading, the index is down a few points, with Euro and US markets pointing to lower opens. Asian markets had a similar day, with Japan’s Nikkei 225 also down 0.9% to 8463 points, the Hang Seng losing

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Why is BHP cheap?

BHP and Rio have been pretty disappointing performers considering there is a commodity boom, one of the few bright spots in the global mess. The stock is down by almost a fifth since mid year. At some point it has to be good buying. UBS has a buy on the stock, with a 12 month price

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Chart of the Day: (P)IIGS share prices

Today’s chart comes from Dr Ed Yardeni’s blog, comparing the performance of the (P)IIGS (Portgual, Ireland, Italy, Greece, Spain) share market indexes (Portugal is not included) for the year so far: Greece is obviously the worst performer, down 48% with Italy not doing so bad, but still in bear market territory down over 20%. How

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Trading Day

The S&P/ASX 200 Index closed down 19 points or 0.44% lower to 4285 points today, after reacting to the falls on EU and US risk markets last night. In after hours trading, the index is up a few points, with Euro and US markets pointing to mixed opens. Asian markets had a worse day, with

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Trading Day

The S&P/ASX 200 Index closed up 8 points or 0.2% higher to 4304 points today, after jumping in the morning session on reaction to the solid gains on EU and US markets on Friday night. In after hours trading, the index is slipping, with Euro and US markets pointing to slightly higher opens. Asian markets

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Chart of the Day: Bear market recap

After reading my report on the Aussie share market, as you still not sure what a secular bear market is? Would you be surprised that the US share markets are 11 years in to a secular bear market? (whereas our own is only 4 years old) Today’s chart comes from Doug Short’s weekly update of

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Trading Day

The S&P/ASX 200 Index closed up 52 points or 1.2% higher to 4296 points today, after a sideways morning session followed by strong bids in the afternoon. In after hours trading, the index has fallen 10 points, with Euro and US markets are pointing to modestly higher opens. Asian markets had a mixed but generally

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Trading Day

The S&P/ASX 200 Index closed down 102 points or 2.4% lower to 4244 points today, reacting to Italian bond dramas overnight. In after hours trading, the index has fallen another 10 points, with Euro and US markets are pointing to slightly lower opens. Asian markets had a bad day, with Japan’s Nikkei 225 down nearly

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Is Myer a buy?

The fate of the big retailers is very much a pointer towards the health of the economy — and vice verca. A number of analysts are looking at Myer which is providing a read on both the economy and the underlying state of the stock market. The picture is for the most part pretty neutral,

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Chart of the Day: S&P500 and Goldman

Continuining again our focus on the US S&P500 stock index, today’s chart come from Goldman Sachs (via Zero Hedge): This chart says a 1000 words, but for those not sure what’s going on, its seems the ca. 1.5% cut to US GDP coming next year (courtesy of austerity), has been priced in the consensus forward

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Trading Day

The S&P/ASX 200 Index closed up 52 points or 1.2% higher to 4346 points today, probably on the back of the news that we had seen the back of Italian Prime Minister Silvio Berlusconi. In after hours trading, the index has given back some of these gains and is down 15 points, with Euro and

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Buy cyclicals?

What is the best equity strategy in such an uncertain environment? Much depends, of course, on the investor’s time horizon. In the short term, with such jumpy markets, reading the signals, especially in relation to Europe’s woes, seems suitable. But of course, volatility creates many risks. In the medium to longer term, it is likely

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Chart of the Day: S&P earnings record

Another chart on the US S&P500 stock index, is from Bespoke Investment Group (via Seeking Alpha). US stock markets report earnings quarterly, as opposed to half yearly in Australia, and with almost 90% of companies in the S&P500 having reported for the third quarter (Q3), Bespoke estimate earnings at $25.42, or on a year’s trailing basis

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Trading Day

The S&P/ASX 200 Index closed up 20 points or 0.48% higher to 4293 points today. In after hours trading, the index has given back on these gains and is down 20 points, with Euro and US markets are pointing to slightly lower or steady opens. Asian markets had a mixed day, with Japan’s Nikkei 225

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Lower rates means lower stocks

An interesting piece by Gerard Minack at Morgan Stanley today which provides some pointers to how to think about investing in such distressed and unusual conditions. Minack notes what has become obvious in a world with such low interest rates: that the customary relationship between interest rates and the stock market has been broken. Lower

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Chart of the Day: S&P500 and the Fed

Continuing our series of charts on the US S&P500 stock index, is today’s from Doug Short, plotting the US Federal Reserve’s (the Fed) intervention via the Fed Funds Rate and other programs that has arguably sustained asset prices. The intervention has been a series of programs, emergency at first (TARP, TALF etc), then a series

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Trading Day

An interesting day on the S&P/ASX 200 Index, closing down 7 points or 0.18% lower to 4272 points after being down more than half a percent all day. In after hours trading, the index is steady, with Euro and US markets are pointing to slightly higher or steady opens. Asian markets experienced similar losses, with

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ASX value trap

Downwards earnings revisions are widely being predicted, which of course makes the market subject to the double whammy of investment fear due to the travails of Western developed markets, and the growing evidence that many of the non-resources stocks, plus a few of the resources companies, are coming under pressure. Merrill Lynch reckons growth forecasts for

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Trading Day

The S&P/ASX 200 Index had a stonking day, closing up 109 points or 2.55% higher to 4281 points after positive leads from overnight markets. In after hours trading, the index is up 8 points, although Euro and US markets are pointing to slightly lower or mixed opens. Asian markets experienced similar gains, with Japan’s Nikkei

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Chart of the Day: S&P versus ASX

Today’s chart is from one of our regular readers The Avid Chartist, who has updated his study of the ASX200 and the S&P500, both denominated in USD. The chart plots the first day of the month from August 2007 through to October 2011. As Avid says very well: We Aussies are financially joined at the hip

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Trading Day

The S&P/ASX 200 Index closed down 12 points or 0.3% lower to 4171 points after positive leads from overnight markets. In after hours trading, the index is up 15 points, although Euro and US markets are pointing to slightly lower opens. Volatility continues to rule. Asian markets experienced broader losses, with Japan’s Nikkei 225 down

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Which bank to buy?

Analysts are looking at banks at the moment, with the tone being, for the most part, sceptical. Westpac is getting the most attention; the consensus seems to be that it is accurately prices. Royal Bank of Scotland has a hold and has slightly raised its price target to $23.69. RBS is not all that impressed:

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Chart of the Day: May 2008 redux?

Australian equity investors must always look abroad to the US to indicate the probabilities of future gains or losses on the ASX as binary risk markets continue to correlate (positively: equities, non-USD currencies, commodities; negatively: USD, USD bonds)to each other. For those who don’t understand or don’t want to believe the impact of world finance

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Trading Day

The S&P/ASX 200 Index closed down 48 points or 1.15% lower to 4184 points after the continuing turmoil in Europe. In after hours trading, the index is steady, with Euro and US markets pointing to positive gains from the heroic losses of last night. Asian markets experienced similar if mixed losses, with Japan’s Nikkei 225

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Are earnings projections low enough?

OK, the market is in a terrible hole. But the question is what has the market priced in and how accurate is it? No earnings growth at all in the case of Rio and BHP, and precious little growth across the market more generally. Such bearishness has proven close to the mark, but it is worth