Local market delivered the first solid positive day in over a week on the optimism that US Hurricane damage was better than expected. Growth worries drove commodities lower over the weekend. Local market bounced on the open on the back of the banks as global investors increased exposure to cover the rising AUDUSD while US futures moving positive on downgrading weather damage helped maintain the optimism. BOC and BOE followed the ECB into more hawkish comments while US Fed is caught between patchy economic data and weather related growth issues. Harvey and Irma are going to weigh on growth in the short term while the Trump administration is likely to spend up on affected areas and let debt blow out again. Market is moving towards a rate hike delay to Dec while outlook may be weakened. The weakening US Fed outlook and strengthening ECB, BOE and BOC have kept the pressure on falling USD. RBA is caught behind the debt bubble and is unable to react to the global scene while the local government is more concerned about survival than policies. The economy is facing tough outlook for consumers and that raises the risk that RBA has priced themselves out of the economic cycle while the high spending governments and over geared households are going to run out of puff. AUDUSD back above mid 80 cents and looking to go higher as commodities hold up on positive China outlook. We continue to favour miners over financials and industrials for September. We continue to see more upside for base metals and precious metals in a weakening USD outlook in the short term...we like RRL and DCN in Gold, MLX and MOD in Copper, WSA and IGO in Nickel, AWC on aluminium and S32 as the diversified outside BHP and RIO. China’s move to curb coal imports to help domestic producers will put pressure on local producers and shows the risk in China’s ability to change quickly. Stay nimble as September outlook remains weak for markets before the next leg higher. Stock moves for the day…(1) PLS (+11%) and GXY (+7%) on China moving to electric cars (2) LYC (+5%) on continued optimism in rare earth (3) DRM (-6%) on weak gold price as US futures bounced (4) RCG (-6%) on weaker consumer outlook and US weak comparable (5) SXY (-6%) on weak oil price movement (6) FNP (-6%) on profit taking after recent rally. BOEQ Footy Finals picks…updated for week 1 result…just for fun!!!
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2017 - Now > Blue Ocean (AUS) > Market Portfolio Strategist 2012 - 2017> Baillieu Holst (AUS) > Head of Strategy, Quant and Data Analytics 2009 - 2012 > Bell Potter / Southern Cross (AUS) > Head of Quant and Data Analytics 2007 - 2009 > LIM...
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