The latest market news, commentary and strategy by Adrian Rowney
5 Things that Grabbed my Attention
1. Many public figures have come out saying Dr Phil of the RBA has lost the plot and is now damaging our economy....No....this has all been years in the making. The madness started when he cut rates all the way down to 0.1% and digitally printed $300bn thus setting the mother of all traps for middle class Aussies and small/medium business....I saw right though the stitch up from the beginning which is why I was banging on the table to fix your mortgage for as long as possible.
2. Westpac said calls to its hardship hotline are increasing....AVOID financials.
3. Consumer discretionary stocks continue to slide - definitely no reason to be in the sector.
4. Bank of Canada increased interest rates by 0.25% to 4.75%...central banks have been operating in lockstep.
5. Eurozone has now entered a recession.
ASX Market Update
ASX 200 down 18 points to 7099
Consumer discretionary stocks were among the worst performers as investors start realizing the average Aussie doesn't have a fat stack of cash lying around anymore. PMV fell 3.25% ADH dropped 4.9% and BBN lost 8.79%
On the positive side, and good for us - COAL stocks were well bid: NHC rallied 8.6% WHC put on 5.5% and YAL added 4.4%
The US Strategic Petroleum Reserve was set up just incase war breaks out, yet the Biden administration has been ignoring its original purpose by offloading a big chunk of it to the Chinese....American's that are paying attention are filthy beyond belief - and rightly so....BUY OIL.
Observation #67— HorizonKinetics (@HorizonKinetics) June 7, 2023
The pattern of drawdowns from the Strategic Petroleum Reserve since the beginning of 2021 is unsustainable. The 283 million barrels released took 25 years to accumulate. Can these be replaced? Will they? pic.twitter.com/NsaBhKyBdn
The Day Ahead
- Our SPI is up 26 points
- Bitcoin up 26 points to $26,540
Movements affecting our resource stocks today (USD)
- BHP in the US up 2.18%
- Newmont up 0.32%
- Gold up 1.12% to $1980
- Paper Silver up 3.64% to $24.39
- Platinum down 1% to $1014
- Copper up 0.84% to $3.78
- Brent Crude down 1.75% to $75.60
- Iron ore up 2.2% to $110.20
Asian Market Update
Japan down 0.85%, China up 0.49% and Hong Kong added 0.25%
While most central banks are hiking rates in lockstep, there is talk that the People's Bank of China is going to CUT.
The rally in Chinese #property developers continues in HK on expectation of more policy measures to support housing market; possible rate cut, RRR cut in H2https://t.co/haGgRmRP6L pic.twitter.com/8JfguUiXND
— YUAN TALKS (@YuanTalks) June 8, 2023
Global Market Update
DOW up 168 points to 33,833
The volatility index (VIX) which is also known as the FEAR INDEX fell another 2% last night and is now trading at 13.65....This basically means investors/traders hardly have a care in the world right now - not me though: my gut is churning!!
Germans up 0.18%, Brits dipped 0.32% and Frenchies put on 0.27%
With two quarters of falling output the Eurozone has technically entered a recession.....The middle class is currently suffering from STAGFLATION (falling economy, rising prices).