Australian Shares

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Macro Afternoon

More hesistation and concern feeding into risk markets today here in Asia, with the shocking unemployment print in Australia absorbed without much fuss. The USD remains mixed against the majors going into the London open while gold holds fast just below the $1730USD per ounce level. In mainland China, the Shanghai Composite is up a

4

Macro Morning

By Chris Becker  Risk sentiment is fading slightly as geopolitical concerns across the Koreas and India/China border clash with the growing coronavirus outbreaks in China and the Southern/western US states. Wall Street sold off going into the close, which should translate into mild losses on the open here in Asia, while currency markets were relatively

118

Macro Afternoon

A much more measured session across stock markets here in Asia as profit taking was the order of the day – except locally as bidders kept on bidding! Concerns about coronavirus spreading in Beijing and the USA are not yet genuine or applicable to heavily goosed risk assets, with the USD retreating slightly alongside S&P

6

Most ever fundies see stock bubble

Via BofAML monthly fundie survey. The most number of fundies see a stock bubble ever: But perhaps that just means we short squeeze even higher: Nobody believes in earnings: But they’re chasing it now anyway: Hedgies are piling in. What exactly are they “hedging”? Biden risk is rising: I’d add the stock bubble itself at

6

The Robinhooders are right!

Cross-posted from FTAlphaville: If you had managed to avoid reading the financial press for the past few weeks, and then decided to catch-up on today, you might notice a new phrase being banded about in market commentary. Namely, “Robinhood investors”. Shorthand for retail punters utilising commission-free brokerage platforms (such as Robinhood) to buy stocks, a

10

Credit Suisse: Diversify to survive stock risks

Via the excellent Damien Boey at Credit Suisse: Infrastructure stimulus package in the wings? Numerous press reports are emerging that US President Trump is mulling over a USD 1 trillion infrastructure stimulus package to shore up the recovery. The reports follow recent Fed announcements (or more precisely, reiterations with more detail) on corporate bond purchasing and “Main Street”

3

Macro Morning

By Chris Becker  There’s a lot to digest from overnight markets including China and India border disputes, rising infection rates and case loads of COVID-19 in the US South, plus a swathe of economic data and Fed Chair Powell’s testimony to Congress. Coupled with the ridiculous surge in Asian stocks yesterday, it all ended up

98

Macro Afternoon

It was “let’s forget about Monday” on Asian share markets today in response to the next layer of the Fed punchbowl and the potential for another Trump crony bailout/looting spree aka bailout package announced overnight. Stock markets soared with the ASX200 up over 4% at one stage while currency markets were relatively mild, as gold

24

Hertz bubble says it all

Via FTAlphaville: Hertz, the bankrupt car rental company which has become the poster-child for the current market’s speculative excess over the past fortnight, just filed this with the SEC. In case you’re wondering what that is, it’s the document outlining the company’s unprecedented $500m share sale which was sanctioned by American courts Friday night. Despite, we should add, the

6

Macro Morning

By Chris Becker  The Fed rides to the rescue! After looking into a 1000 drop in the Dow overnight, the Federal Reserve stepped in and announced they were buying up all the corporate bonds, injecting $750 billion into the rotten, sucking “risk” edifice that lapped it up with glee. Another papering over of real macro

155

Macro Afternoon

Not a good start to the week for Asian stocks with a strong selloff across the region and Wall Street ready to tumble as markets reopen tonight. This is in the wake of the surge in COVID-19 cases across the US and in Beijing, with risk off extending to currencies with gold and Bitcoin both

18

ASX bleeds into spreading pandemic

The Australian dollar has opened sharply lower this morning and is forming a short term bearish descending triangle pattern: Bonds are bid: Stocks are down modestly: Big iron is hanging on: Big Gas is up a tick: Big Gold is the same: Big Banks haven’t fully realised that the value rotation is cooked: Big Chunt

3

Stocks hammered by rotation volatility

Via the excellent Damien Boey at Credit Suisse: Extraordinary factor rotation of late. In early June 2020, momentum and value factor portfolios have been experiencing wild swings. One week it was value very sharply up, and momentum very sharply down, only for the factors to switch places on the leader board the following week. The last time we saw such sharp factor rotation

2

Macro Morning

By Chris Becker  Another night of mixed sentiment to finish the trading week on Wall Street on Friday with US shares opening higher before settling with a minor bounceback, relatively speaking from their volatile previous session. Other risk assets were largely range bound, unsure of where sentiment truly lies given the surge in COVID-19 cases

133

Macro Afternoon

Another red day for stocks across Asia but not as bad as expected given the huge risk off mood from Wall Street overnight with a late rally in the afternoon session covering a lot of the losses. Meanwhile the USD has firmed against most of the majors, particularly Yen while the Aussie almost broke the

24

ASX slaughter resumes

The Australian dollar is free-falling this morning: Bonds are boom bid: XJO is being slaughtered again: Big Iron is down: Big Gas ouch: Big Gold is holding: Big Banks slaughter: Big Chunt yawn: My base case for this correction is to wipe out all of May’s gains as the fantasyflation value rotation into banks etc

1

Macro Morning

By Chris Becker  Hilarity ensued last night on risk markets as traders finally worked out the second wave of COVID-19 in the US is coming faster than the first, as new cases and ICU bed use balloon outside of NY. The Fed helped things along with the release of some very gloomy economic figures which

15

Hertz bubble pops

Via FTAlphaville: Well, that didn’t take long. Just as the undead equities rose from the grave to haunt portfolio managers, market strategists and journalists over the past few days, so they now must return to the earth. After all no one, not even our most venerated religious figures, can escape the after life. Yes that applies to

18

ASX bath of blood returns for banks

AUD is struggling this morning: Bonds are bid and the yield curve has been crushed: Stocks have erased a poofteenth of the recent ramp: Big Iron is soft: Big Gas too: Big Gold needs a breakout to restore faith: Big Banks have reversed down with the yield curve. This nicely illustrates the market’s bizarre fakeflation

3

Macro Morning

By Chris Becker  Last night saw the latest FOMC meeting pass, where the Fed’s stance was more accommodative than expected, and coupled with inflation data that was slightly weaker than expected, caused the bond market to tip over into a buying frenzy, with the 10 year yield falling from 0.83% to 0.73%. The USD fell,

93

Macro Afternoon

  A flat day for stocks across Asia with Chinese shares falling the most on poor sentiment around Hong Kong. European shares look set to open a little higher with the USD falling against the majors, particularly Yen as risk seems poised here after a frenzy of buying. In mainland China, the Shanghai Composite pulled

7

CS: Beware the inflation!

Via the excellent Damien Boey at Credit Suisse: The world is not in deflation despite a sharper recession than the 2008 global financial crisis. In the “Great Moderation” era, economists have used output gaps to understand and predict inflation. Above (below) trend levels of activity, or activity growth, have historically been consistent with accelerating (decelerating) inflation. And over the years, we have seen some

7

Retail stock bubble buys all the things

Via Bloomie: Everyone knows retail investors dived back into the market as stocks rebounded. Now, evidence is starting to build that their buying has become a key driver of the beaten-down shares that are dominating the rally. Companies that have been soaring are in many cases the same firms that have seen skyrocketing interest at

5

Macro Morning

By Chris Becker  A pause a stall or a breakdown occurred on stock markets overnight – except the NASDAQ – with all major markets retreating slightly as probability finally caught up to the blowout trends. The USD was sold off once more, while Treasuries rallied leading up to tonights FOMC meeting as yields dropped back

24

ASX bubble bulges

AUD is still warm this morning: Bonds are bid: XJO is red hot: Admire the great ASX bubble of 2020: Big Iron to the moon: But positively cheap versus some: Big Gas to the moon: Big Gold can’t get a bid amid the largest monetary fire hose in history: Banks to the moon as all

2

Macro Morning

By Chris Becker  Equity markets continue to fully price in a V-shaped recovery and are about to return to their pre-COVID19 highs, as Wall Street rallied overnight to a three month high following the good start to the week here in Asia. Australian markets will reopen today and likely continue the orgy of buying as

81

Macro Afternoon

A sea of green, but not quite as deep as expected following the orgy of buying on Wall Street on Friday night after the better than expected monthly US jobs report. Enthusiasm to reflect those overseas returns into something substantial has waned, with Australian markets closed due to the long weekend, with most major currencies