The latest market news, commentary and strategy by Adrian Rowney
5 Things that Grabbed my Attention
1. CBA announced it wrote off $586mil of bad debts as higher rates start squeezing some of its customers....The nasty cycle has started. AVOID FINANCIALS
2. Warren Buffet sold $5.5bn worth of bank stocks last quarter....another red flag.
3. Property prices in some of those regional areas that took off during the FauciFlu, have come back to earth somewhat....Corelogic reported that prices over the past 12 months in Byron have fallen 26.1%, Mullumbimby off 28.2% and Ocean Shores down 24.9%....I can't remember property EVER being this volatile.
4. Macquarie and Credit Suisse think the Star Group (SGR) need to raise around $400 mil to fix its balance sheet.....And I think it could even be more if the pending AUSTRAC fine is a monster from the deep!
5. The FTSE (UK stock market) cracked 8000 points for the first time ever overnight....Investors were happy that inflation came in @ a lower than expected rate of 10.1%....10.1% = average joe is getting screwed.
ASX Market Update
ASX 200 down 78 points to 7352
Our banks got a decent touchup as CBA officially kicked off the inevitable cycle of bad debts with $586 mil worth of write downs.....I really don't see the need to be invested in the sector; sure a bank like CBA is solid, but you are paying around 19 times earnings - so it's definitely in the expensive territory, plus we are likely to see some chaos in the global financial system this year which means the cost of bank funding could spike....AVOID FINANCIALS.
Random Observation
An excellent quote from one of the greatest investors of all time....
The Day Ahead
Reporting today: AMP, DHG, EVN, GMG, IPL, NAB, MFG, NCM, SHL, SUL, WHC, TLS, SUL
- Our SPI is up 29 points
- Bitcoin up 4.9% to $23,294
Movements affecting our resource stocks today (USD)
- BHP in the US down 0.54%
- Gold down 0.9% to $1848
- Paper Silver down 1% to $21.65
- Copper down 1.2% to $4.02
- Brent Crude FLAT @ $85.69
- Iron ore up 0.8% to $123.45
Asian Market Update
China down 0.39%, Hong Kong fell 1.4%, Japan dipped 0.37%
“Big Short” investor placed new bets on Alibaba, https://t.co/gX9Ipu5bD8 pic.twitter.com/AhiAruJHeG
— Cathy Yuan Zhang (@CathyYuanZhang) February 15, 2023
Alibaba and JD.com are in the BETASHARES ASIA Technology Tigers ETF which trades on the ASX under the code - ASIA. BUY
Global Market Update
US Market
DOW up 38 points to 34,128
We saw a positive session on Wall Street as US retail sales grew at 3% in January, which was way higher than the expected 1.9%....Tesla shares continue to gain, adding another 2.4% - the shorts have been getting murdered on this one.
European Markets
Brits up 0.55%, Germans put on 0.82% and Frenchies rallied 1.2%
10.1% inflation in the UK - what a shocking situation as STAGFLATION (rising prices plus weak economy) takes hold.
Key Market Summary
