Sunset Strip > Trading Day Wrap From Blue Ocean 20170725

Mathan Somasundaram

Local market bounced back from yesterday’s underperformance on the back of strong commodities and AUDUSD. Banks were up on currency/yield trade while Resources were up on commodity bounce. Aussie CPI data tomorrow…high AUDUSD means outlook is for weaker inflation…unlikely to back any RBA rate hike scare story in 2017. The best performing sectors were Gold, Health Care and Retail while the worst performers were Telecom, Energy and Staples. On the sector/stock front….(1) ISD turnaround continues with substantial short covering to drive the process (2) MYX also benefits from substantial shorts being covered after big fall (3) NCM leads the gold sector recovery…more to come as safe haven investing comes back in fashion (4) A2M leads the food category on safe growth outlook (5) ALU leads the IT growth sector stories after recent pullback (6) MSB gets hit on US health care sentiment (7) DRM operational issues hurting the stock despite the bounce in spot gold (8) CCL can’t beat a trick…running into more issues with WOW.

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