Australian Shares

From Ambrose Evans-Pritchard: The Royal Bank of Scotland (RBS) has advised clients to brace for a “cataclysmic year” and a global deflationary crisis, warning that the major stock markets could fall by a fifth and oil may reach $US16 a barrel.

The institutional memory regarding bear markets is fading fast as Deutsche Bank have research out this morning pointing to one inescapable conclusion: The note is framed as 13 questions and answers, my responses below the bold print: 1.

by Chris Becker   The shocking Asian yesterday translated into first, a repeat, but then a bounce of risk going into the US session before a late selloff as participants realised the worse is not yet over.

Global markets are still in the grips of China fears, and it is uncertain whether the Chinese government can do enough to reassure global investors. The People’s Bank of China (PBoC) fixed the CNY largely unchanged from its position on Friday.

Well there it is.

by Angus Nicholson, IG The “National Team” has answered the markets’ call, fixing the CNY’s mid-point slightly stronger and intervening heavily in Mainland Chinese equity markets.

by Chris Becker Its the worst start to a New Year trading session ever for American and European stocks.

What a week to start the year as the Mining GFC rolls upon us.

by Angus Nicholson, IG The largest one-day weakening in the CNY mid-point since August has put China devaluation concerns and a global deflationary crisis front-and-centre in investors minds.

Regular MB reader “Avid Chartist” put me on to an idea on his blog that has been around for awhile – the so-called seven year cycle. His thesis revolved around the tops in the USD, as measured by the US Dollar Index (DXY), but through the viewpoint of the Australian dollar.

by Chris Becker Calm is definitely not the word to describe the bringing in of the New Year.

Angus Nicholson for Chris Weston, IG China fears have again dominated Asian markets today, and then later in the day a large North Korean nuclear bomb test added a touch of Armageddon fears to the markets as well.

Angus Nicholson for Chris Weston, IG Remember how China was going to stimulate heavily in Q3 and Q4 to stabilise the economy and quell global investor concerns before the Chinese New Year economic data blackout in February 2016?

CHRIS WESTON Chief Market Strategist, IG   It seems traders were exposed to nearly all of the macro fears of 2016 in just one session and we have been left with a full risk-off trading session.

My personal advise (for what it’s worth) in 2016 is to have an open mind on the markets.

by Chris Becker Welcome back to Macro Morning for another year of market frivolity.

Angus Nicholson, IG   Asian markets have followed the lead from Wall Street as we have seen strong gains in Australia and Japan.

  ANGUS NICHOLSON, IG Market Analyst Asian markets have looked past the wobble in oil prices and Chinese data yesterday to push tentatively into the green.

Angus Nicholson, IG for Chris Weston The ASX rallied up over 5200 to see its strongest close since 3 December despite volumes being 50% below their 30-day average.

by Chris Becker Ho ho hum. Except for the unexpected early release of the November personal consumption expenditure (PCE) report in the US, which showed increasing consumer spending amid zero inflationary pressures, it was same old Santa rally into the last session of the week overnight as US and European stocks surged.

From BofAML: Central banks have had a tremendous impact on financial markets in the last seven years, which is never more apparent than when looking at the world through the volatility lens.

Angus Nicholson for Chris Weston, Chief Market Strategist at IG Markets A positive day of trade in Asia today driven by a bounce in oil prices and weakness in the US dollar.