ASX 200 collapsed again, down 47 points to 5339 as the Draghi disappointment brought back the bears. Banks were the biggest losers with materials and energy positive. Four straight weeks of losses now. Asian markets flat lining with Japan up 0.04% China down 0.017%. AUD back to 76.41 and US futures down 8points.

For the week we have fallen from 5372 to 5339 for a loss of around 0.6%. Since Friday 12th August the ASX has quietly dropped from 5531 to 5339 a fall of 3.4%

STOCKS AND SECTORS

  • Banks sloppy today after Draghi had nothing up his sleeve to appease markets and the risks for euro trash banks increases. Westpac Bank (WBC) -1.63% the stand out faller. The big bank basket was trading around $154.50 falling from $156.87.
  • Insurers and wealth managers not much better. Macquarie Group (MQG) -1.27%, Platinum Asset (PTM) -2.91% and Magellan Financial (MFG) -1.67%
  • REITS fell in a hole today after the rally yesterday. GPT -0.99% Stockland (SGP) -2.74% and Scentre Group (SCG) -2.96%
  • Resources one of the only bright spots. Whitehaven (WHC) +8.65% bounced hard with Orica (ORI) +2.08% also in demand with the usual iron ore suspects firmer, Fortescue Metals (FMG) +1.23%
  • Energy stocks had a very good bounce with the exception of Santos (STO) -1.96% on balance sheet concerns. Origin Energy (ORG) +5.46% led the sector higher followed by Oil Search (OSH) +3.84% Beach Petroleum (BPT) +3.74%.
  • Industrials were a nasty shade of red across the board with eth healthcare sector coming under pressure again. CSL -2.25% will test $100 next week with falls in Cochlear (COH) -1.59% Sonic Healthcare (SHL) -2.94% and Sirtex (SRX) -2.70%. The star performer was Sigma Pharma (SIP) +9.34% after the good results yesterday
  • Tech and telco land was weaker as Telstra (TLS) -0.98% continue to slide towards a $500 breach. TPG Telecomm (TPM) -2.06% and Vocus Comm (VOC) -2.29% followed in its wake.
  • IT stocks also in profit taking mode with Integrated Research (IRI) -3.81% Technology One (TNE) -1.90% and Carsales (CAR) -1.71%.
  • Consumer staples and discretionary had nowhere to run to nowhere to hide. Woolworths (WOW) -1.80% and Wesfarmers (WES) -1.07% together with Cuppie (Chinese Yuppies) stocks Bellamy’s (BAL) -2.30%, Blackmores (BKL) -0.87% and MG Unit Trust (MGC) -7.25%.
  • Speculative stock of the day: Coal stocks are back in fashion and today Tiger Realm Coal (TIG) +36.00% released its results. The company has a coking coal project in the far east of Russia and is currently raising $23m through a rights issue to push the coal strategy.

CORPORATE NEWS

  • Origin Energy (ORG) +5.46% announced that the long term CEO Grant King would be retiring and CFO Frank Calabria will take over the reins. King has been at the helm for 14 years since Origin first came into being.

ECONOMIC NEWS

  • Housing finance numbers came in below expectations in July, driven by falls in owner-occupier approvals, while investor approvals ticked slightly higher. The number of home loans approved fell 4.2% in July, missing market expectations of a 1.5% fall, while the value of total housing finance was down 1.8% in the month.
  • Housing loans to investors totalled $11.8bn in July, their highest monthly level in almost a year.

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ASIAN NEWS

  • North Korea caused earthquakes today as it launched its fifth nuclear test.
  • In China: The CPI hit its weakest level in almost a year in August, pulled down by falling food costs. The consumer price index (CPI) rose 1.3% in August from a year earlier, compared with a 1.8% increase in July. That was the slowest pace of inflation since October 2015. Analysts had expected a 1.7% gain.
  • Zinc is this year’s best performing commodity, climbing more than 43%, coal is not far off with Australian coal up 40%. The Bloomberg commodity index rose 7.3% in that time.

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  • Taiwanese shares declined the most in two months as suppliers to Apple fell in the wake of the new iPhone launch. The Taiex index slid 1.06% to 9,156.46 paring this week’s advance to 2 percent.

EUROPE AND THE US

  • Wells Fargo has been slapped with a US$185m fine to settle claims that employees opened accounts without customer approval and earn bonuses. 2m false accounts were opened and over 5300 employees have been sacked over the scandal.
  • It seems that Super Mario has run out of options now urging governments to act to get the EU economy back on track and this is before the Brexit The ECB has downgraded its growth forecast for the next two years, citing the uncertainties of Brexit, and admitted that it has little chance of meeting its 2% inflation target this decade
  • A former Swiss president has suggested that the UK should work with Switzerland to forge a good relationship with Europe and adopting a rigid approach to free movement is not helpful.

And finally……………..

Ronnie Corbett:  “Do you think marriage is a lottery?”
Ronnie Barker:  “No. With a lottery you do have a slight chance.”

 

”I said to the Gym instructor “Can you teach me to do the splits?” He said, ”How flexible are you?” I said, ”I can’t make Tuesdays”

 

I met a Dutch girl with inflatable shoes last week, phoned her up to arrange a date but unfortunately she’d popped her clogs.

 

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Clarence

XXX

Just as an aside Clarence will be heading off to Europe next week on Wednesday to sample the delights of Italy and UK. Normal service will resume when he returns. In the meantime stay safe and stay cosy!

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NT Markets

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