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The Good Morning Report

Posted on January 18, 2023

The latest market news, commentary and strategy by Adrian Rowney 

5 Things that Grabbed my Attention

1. Aussies have been going absolutely berserk at the shops....JB HiFi (JBH) just dropped some mega sales numbers....In light of surging inflation and negative wage growth - what kind of hole are some people digging themselves?

2. Rio Tinto (RIO) is allocating most of its exploration budget to searching for COPPER....I still like Sandfire (SFR) even after the huge run...RXM and CBE are my favoured roughies!

3. Reuters are reporting that NZ breweries are facing CO2 shortages with rationing likely.....One of the greatest made up lies of all time is that CO2 (which is an invisible chemical compound and is also the basis of all life form on earth) causes global warming....Watch Alan Jones - in a timeless classic as he drops TRUTH bombs on Q&A

4. Stanmore (SMR) hit a fresh record high...SMR and YAL will be the major beneficiaries of China lifting its ban on Aussie coal - because these two mine the super duper high quality METALURIGAL COAL - which is what the Chinese need to make steel.

5. Demand for OIL in China is going to hit a record this year as the country opens up....We could easily see a price spike. BUY STO, BPT and WDS

ASX Market Update

ASX 200 down 1.9 points to 7386

Resources rolled over a bit on the back of profit taking, while financials mostly held up - net result was a FLAT market....JB HiFi posted a record December half trading update - can you believe we collectively spent a whopping $5.3bn on stuff!.....Not everyone was happy with the result as the stock dipped 1.25% - talk about a tough crowd! JBH is trading on a single digit PE so is not expensive, but I am nervous about whether this retail boom can last - hence I rate the stock as a HOLD.

Random Observation

This is exactly why I don't take broker price targets seriously - in the past month or so, Macquarie has changed it's price target on Woodside 4 times! Their clients must be getting dizzy with all the churning....I predict Woodside will eventually trade above $50 - but what happens in the short term is anyone's guess.

The Day Ahead

  • Our SPI is up 24 points (not sure what the futures traders are seeing!)
  • Bitcoin up 0.8% to $21,363

Movements affecting our resource stocks today (USD)

  • BHP in the US down 1.9%
  • Gold down 0.7% to $1908
  • Paper Silver down 1.4% to $24.03
  • Copper up 0.42% to $4.23
  • Brent Crude up 1.36% to $85.60
  • $A up 0.5% Vs USD, now buys 69.9c

Asian Market Update

China down 0.1%, Hong Kong off 0.78% and Japan added 1.23%

I'll be surprised if we are not paying significantly more for our petrol at the bowser this year...

 

Global Market Update

US Market

DOW down 391 points to 33,910 

Wall Street bank, GOLDMAN SACHS missed quarterly earnings expectations by a wide margin. Market was expecting $5.48 but it came in a $3.32 per share....Not sure what went wrong - normally they are the grandmasters of leeching/grifting/scalping fees from all corners of the world. GS shares only fell 6.4% - I thought it would have gotten whacked harder on those numbers.

European Markets

FTSE down 0.12%, DAX up 0.35% and CAC added 0.48%

The TYCOONS are getting more cryptic with their speeches this year at DAVOS....

 

Key Market Summary

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