THE WEEK THAT WAS<\/p>\n
\u00a0<\/p>\n
Around the wide world share markets were largely higher by the end of last week, engorged on the tasty news out of the US that interest rates look like having peaked.<\/p>\n
At home it was far more topsy-turvy, with the benchmark surging mid-week and clocking a near two-month high of 7,105 points \u2013 after the good US news on inflation supercharging risk-on confidence that interest rates have peaked.<\/p>\n
The September wages read came in at an all-time record high \u2013 but this was tempered by the recognition in the September quarter of the Fair Work Commission\u2019s wage review, which included minimum wage fun and the long-overdue correction to workers in the Aged Care sector.<\/p>\n
And thank you, BTFW, aged care workers.<\/p>\n
The jobless figures for October revealed a +0.1% increase to 3.7% \u2013 okay \u2013 and at least moving in the right direction as far as the RBA is concerned.<\/p>\n
So that was all pretty volatile stuff for the local market \u2013 but overall positive for the ASX200 \u2013 closing up +1.05% after registering the seven-week high on Wednesday. It was easier going on Wall Street, but the significant decline in Australia\u2019s 3-year bond yields from 4.24% to 4.1% was a good enough added extra to lift our stocks higher as well.<\/p>\n
The 10-year bond yields fell by 15-20 basis points on optimism major central banks have finished raising rates.<\/p>\n
\u00a0<\/p>\n
Via AMP<\/p>\n
For the week US shares rose +2.25%, Eurozone shares gained +3.25% and Japanese shares rose +3.2%.<\/p>\n
Chinese mainland markets fell -0.5% and why not with the ongoing concerns about the Chinese property market.<\/p>\n
On the local small cap map, Kula Gold (ASX:KGD)<\/strong><\/a> \u2013 with a +150% price hike \u2013 brought home the best bikkies.<\/p>\n A double tap of announcements direct to the head of the market set off the buying\u00a0 \u2013 confirmation the drills are set to spin at the company\u2019s \u201csubstantial\u201d Cobra Lithium Prospect in WA next week and that the drilling operation is ready-funded, thanks to a handsome $650,000 boost from a placement of shares at the issue price of $0.013 a pop.<\/p>\n TechGen Metals (ASX:TG1)<\/strong><\/a> also had a cracker last week \u2013 up +144% off the back of an exploration update.<\/p>\n Our stocks were led by Property, Tech, Material and more runs on the board for Health Care.<\/p>\n \u00a0<\/p>\n Via MarketIndex<\/p>\n \u00a0<\/p>\n Energy stocks were absolutely caned last week after oil prices fell for a fourth straight week, this time on rising inventories. Metal and iron ore prices were lower by Friday.<\/p>\n Elsewhere, it really does appear that labour markets in both Australia and the US have clearly turned, according to Westpac economist Ryan Wells who noted that the jobless rate here inched back up to 3.7% last month and total hours worked seems to be levelling out.<\/p>\n In the US jobs growth has also slowed, leaving market participants to begin spitballing about when will central banks reverse course and start cutting rates.<\/p>\n Yet for Australia, Westpac notes, the question remains whether the RBA still has further to go with rate increases.<\/p>\n We aren\u2019t there yet, says the economics team at Westpac. Here\u2019s some of their recent observations on where we are vs inflation, featuring a gorgeous economy in both words and<\/em> economics:<\/p>\n \u201cAustralia can be viewed as being six or so months behind some other countries in its disinflation journey. Like the United States earlier in the year, Australia is still in the phase of being surprised how slow services inflation declines at first. <\/em><\/p>\n \u201cA further wrinkle here is that the shock to energy prices following Russia\u2019s invasion of Ukraine last year only flowed through to domestic retail electricity costs in July this year. In this sense, the dynamics of the inflation cycle can also be a little slower. <\/em><\/p>\n \u201cThe other main driver of the later expected turning point for rates is that the RBA has, for a variety of reasons, seemingly chosen a \u2018not quite as high for longer\u2019 strategy.\u201d<\/em><\/p>\n The good news on inflation is evident via the next chart from Shane Oliver, head of investment strategy and chief economist at AMP, which shows the various inflation rates \u2013 in brilliant technicolour for some of the major developed countries, including us truly\u2026<\/p>\n Via AMP<\/p>\n Shane says that while there is high anxiety about sticky services inflation, on the whole inflation is continuing to fall \u2018about as quickly as it went up.\u2019<\/p>\n \u201cRelative to the US, Canada, Europe and the UK, Australian inflation lagged on the way up and peaked a little later (partly reflecting the slower reopening from covid) and it\u2019s doing the same on the way down so there is no reason to be alarmed that its higher than in North America and Europe. More broadly because the surge in global inflation led that in Australia, the decline in global inflation points to a further decline in Australian inflation ahead.\u201d<\/p>\n The big market mover last week \u2013 US consumer prices \u2013 came in dazzlingly flat for October against the united fears of a +0.1% gain, leaving annual inflation at 3.2%yr from 3.7%yr in September.<\/p>\n That was all equity markets needed, though there was more \u2013 the falling oil prices were the main cause of the monthly inflation-deceleration, but it was the decline in core prices \u2013 below expectations at +0.2% which has traders pumped.<\/p>\n Within that core basket, goods prices have fallen for five straight months. Frankly, any shopper will tell you that doesn\u2019t seem to be the case. Here or in the States.<\/p>\n Disinflation also looks to be broadening through services ex-shelter, indicating softer consumer demand and business pricing power. As shelter retreats in coming months, the FOMC\u2019s 2.0%yr will come within reach, likely mid-2024.<\/p>\n Despite these developments, commentary from FOMC members remains cautious. Chicago Fed President Goolsbee highlighted the importance of rents to the next leg down in inflation, while San Francisco Fed President Mary Daly warned against prematurely claiming victory over inflation.<\/p>\n \u00a0<\/p>\n Firstly, at about 5pm on Sunday night in Sydenham, ahead of the cricket, which we won (right? right?), the SPI Futures are pointing to a solid +0.4% open on Monday morning, thanks to the bulls being unleashed across EU markets on Friday and some late but positive moves on the commodities front, with oil and metals regaining lost ground.<\/p>\n On the global stage \u2013 there\u2019s a week ahead of preliminary manufacturing and services PMIs for France, Germany, the Euro Area, the UK and Japan.<\/p>\n Then there\u2019s some central bank action with interest rate decisions slated for the crazypants team at the Central Bank of the Republic of T\u00fcrkiye, led by Governor Hafize Gaye Erkan whose crew has hoisted its key interest rate to 35% from 8.5% since June.<\/em><\/p>\n With price growth in Turkey looking like it has more in the legs at a cool 60%, Erkan promised Turkey that she has the backing of President Recep Tayyip Erdogan to do whatever\u2019s needed in terms of raising rates until the madcap inflation\u2019s been whipped.<\/p>\n That\u2019s probably because the notoriously fickle Erdogan sacked Turkey\u2019s previous three governors, before appointing Erkan in June.<\/p>\n Elsewhere, central banks meet in Sweden, South Africa, and Indonesia, while Germany will publish its Ifo Business Climate report.<\/p>\n It\u2019s Thanksgiving week in the United States.<\/p>\n Once Wall Street crawls past the release of the November Fed minutes on Tuesday in New York, and then the durable goods orders on Wednesday morning, it\u2019ll be slam the doors and lock up the kids as the exodus for the Hamptons begins in earnest.<\/p>\n Until then whatever focus is left will rest on those two majors and then a few services, and manufacturing PMIs from S&P Global as well as US home sales.<\/p>\n Closer to home,\u00a0 the People\u2019s Bank of China (PBoC) is expected to hold its loan prime rates (LPR) unchanged following the hold of its medium-term lending facilities. But honestly, China \u2013 who knows?<\/p>\n In Japan, it\u2019s all about October\u2019s inflation print as a porous yen is likely the culprit behind higher consumer prices, which would add to the pressure on the Bank of Japan (BoJ) to\u00a0 give up on its crazy-ultra-loose policy.<\/p>\n Japanese PMI data for November is also\u00a0 due.<\/p>\n Elsewhere, Thailand will unveil its Q3 GDP, while Malaysia and Singapore drop their CPI for October.<\/p>\n Back in the States, where it\u2019s eternally earnings season, there\u2019s exciting reports dropping from Zoom, Nvidia, Lowe\u2019s, Analog, Dell, Autodesk, HP, Dollar Tree, Best Buy, and Deere & Company.<\/p>\n Wall Street is closed on Thursday and closes early on Black Friday \u2013 a brief and oft pointless session marked by the absence of anyone.<\/p>\n Japan is also closed on Thursday.<\/p>\n The RBA minutes are the only blemish \u2013 dropping on Tuesday \u2013 in an otherwise data-free week at home.<\/p>\n On the corporate front, Technology One (ASX:TNE)<\/strong><\/a> Webjet (ASX:WEB)<\/strong><\/a>, and Virgin Money UK (ASX:VUK)<\/strong><\/a> drop earnings.<\/p>\n And we are mid-AGM season, with a whole host of diggers facing the shareholders.<\/p>\n \u00a0<\/p>\n Via Movember<\/em><\/p>\n Josh Gilbert, market analyst at eToro<\/a>, shares his three things to watch in Australia in the coming days\u2026 (aside from this HIGHLY suspicious attempt at a Movember \u2018tache\u2026)<\/em><\/p>\n \u00a0<\/p>\n Materials AGMs<\/strong><\/p>\n This\u2019ll be a big week on the ASX materials front with a gaggle of key miners in the sector rolling out their respective AGMs, says eToro\u2019s winner of the coveted eToro Best Looking Cornish Analyst 2022\/2023<\/em>, Josh Gilbert.<\/p>\n Josh says the two big names worth watching are Pilbara Minerals (ASX:PLS)<\/strong><\/a> and Core Lithium (ASX:CXO)<\/strong><\/a><\/p>\n \u201cBoth stocks have had a miserable 12 months as Lithium prices continue to free-fall. Worse still, Core Lithium has seen shares plummet by 75% in that time, so this is a key AGM to reassure investors of what\u2019s ahead.<\/p>\n \u201cElsewhere, we have updates from gold miners Bellevue Gold (ASX:BGL)<\/strong><\/a> and Evolution Mining (ASX:EVN)<\/strong><\/a>. Both these stocks have performed in stark contrast to the lithium names, gaining more than 40% each in the last 12 months.\u201d<\/p>\n This is thanks in part to the recent rally in Gold prices, as geopolitical tensions cause uncertainty across global markets and central banks buy gold at record levels, Josh says.<\/p>\n \u201cAGMs are an important time for shareholders and the business itself. A poor AGM can impact investor confidence, but a solid AGM can drive positive investor sentiment. It\u2019s a great time for investors to get a sense of if the business is delivering and what\u2019s ahead. With lithium\u2019s slump largely driven by slow demand against a glut of supply, material investors will be hoping for strong indications of increased lithium demand in the tech and hardware sector going into 2024.\u201d<\/p>\n \u00a0<\/p>\n Michelle Bullock Speech & RBA Minutes<\/strong><\/p>\n On Tuesday, the man from beautiful Truro in gorgeous Cornwall says, the latest RBA minutes will be released against the backdrop of the ASIC Annual Forum, where RBA Governor Michelle Bullock is due to address a fired-up crowd of regulators.<\/p>\n \u201cThe meeting minutes will give some good insight into the central bank\u2019s decision to raise the cash rate by 25bps, particularly given it was such a live meeting. However, the bigger picture sentiment will tell us what we already know; while other central banks increasingly head towards a softer tone, Australia is far from out of the woods \u2013 and the RBA\u2019s hawkish bias will likely stay intact for now.<\/p>\n \u201cAt the forum, investors will still be looking for any hits of doveish sentiment from Bullock, similar to what we saw in the statement following the decision. It\u2019s highly unlikely they will get that, though, with this week\u2019s unemployment and wage figures causing further headaches for Bullock and the board heading into the year\u2019s end.<\/p>\n \u201cUnfortunately, anyone hoping for the 28th of November\u2019s retail figures indicating the economy is cooling may have their hopes dashed \u2013 and a December rate pause will not signal the hike cycle is over, especially once retail figures drop in January following both the Christmas and Black Friday flurry.\u201d<\/p>\n \u00a0<\/p>\n Nvidia Earnings<\/strong><\/p>\n NVIDIA investors will be gearing up for what is likely to be an impressive set of earnings on Tuesday, US time, Josh says.<\/p>\n \u201cNVIDIA more than delivered in Q2 with eye-watering results, along with a solid forecast for the upcoming quarter, guiding for revenue of US$16 billion, well above estimates of US$12.6 billion.<\/p>\n \u201cEven with the Magnificent Seven going in hard on AI, NVIDIA is still leading the pack when it comes to converting hype into profit. Earnings are expected to rise by just under 500% next week, putting AI monetisation front and centre.<\/p>\n \u201cThe stock has continued to perform impressively, sitting near record highs after gaining 240% this year. Recently, shares experienced a 10-day winning streak in November, following a dip in October. The good news for AI investors broadly is that demand is set to stay high, with use cases exploding and businesses continuing to spend big.\u201d<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Source: Westpac, Commsec, Trading Economics, S&P Global Research, AMP\u00a0<\/strong><\/em><\/p>\n \u00a0<\/p>\n TUESDAY\u00a0<\/strong><\/p>\n Australia RBA Meeting Minutes (Nov)<\/p>\n WEDNESDAY<\/strong><\/p>\n Australia Westpac Leading Index (Oct)<\/p>\n THURSDAY<\/strong><\/p>\n Australia Judo Bank Flash PMI, Manufacturing & Services<\/p>\n \u00a0<\/p>\n Monday\u00a0<\/strong> Tuesday\u00a0\u00a0<\/strong> Wednesday\u00a0<\/strong> Thursday\u00a0\u00a0<\/strong> Friday\u00a0<\/strong> <\/span><\/p>\n The post Traders\u2019 Diary: The wolves are at the door, but the bulls are in the bathroom<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"ASX SECTORS LAST WEEK<\/h2>\n
THE WEEK THAT WILL BE<\/h2>\n
3 things to watch for the week<\/span> ahead<\/h2>\n
The Australian &\u00a0 Global Economic Calendar<\/h2>\n
Monday November 20 \u2013 Friday November\u00a0 \u2013 24<\/strong><\/h2>\n
\nChina (Mainland) Loan Prime Rate (Nov)
\nThailand GDP (Q3)
\nMalaysia Trade (Oct)
\nGermany PPI (Oct)
\nTaiwan Export Orders (Oct)<\/p>\n
\nSouth Korea PPI (Oct)
\nNew Zealand Trade (Oct)
\nSwitzerland Trade (Oct)
\nUnited Kingdom Labour Productivity (Q3, prelim)
\nHong Kong SAR Inflation (Oct)
\nCanada Inflation (Oct)
\nCanada New Housing Price Index (Oct)
\nUnited States Chicago Fed National Activity Index (Oct)
\nUnited States Existing Home Sales (Oct)
\nUnited States Fed FOMC Minutes<\/p>\n
\nSouth Africa Inflation (Oct)
\nTaiwan Unemployment (Oct)
\nUnited Kingdom CBI Industrial Trends Orders
\nUnited States Durable Goods Orders (Oct)
\nEurozone Consumer Confidence (Nov, flash)
\nUnited States University of Michigan Sentiment (Nov, final)<\/p>\n
\nUnited States, Japan Market Holiday
\nUK S&P Global\/CIPS Flash PMI, Manufacturing & Services*
\nGermany HCOB Flash PMI, Manufacturing & Services*
\nFrance HCOB Flash PMI, Manufacturing & Services*
\nEurozone HCOB Flash PMI, Manufacturing & Services*
\nSingapore GDP (Q3, final)
\nSingapore Inflation (Oct)
\nNorway GDP (Q3)
\nIndonesia BI Interest Rate Decision
\nTaiwan Industrial Production (Oct)
\nTaiwan Retail Sales (Oct)
\nTurkey TCMB Interest Rate Decision
\nSouth Africa SARB Interest Rate Decision<\/p>\n
\nUnited States, India (Partial) Market Holiday
\nJapan au Jibun Bank Flash Manufacturing PMI
\nUS S&P Global Flash PMI, Manufacturing & Services
\nNew Zealand Retail Sales (Q3)
\nJapan Inflation (Oct)
\nMalaysia Inflation (Oct)
\nSingapore Industrial Production (Oct)
\nGermany GDP (Q3, final)
\nGermany Ifo Business Climate (Nov)
\nMexico GDP (Q3, final)
\nCanada Retail Sales (Sep)<\/p>\n