Two ASX upgrades + our Chart of the Week

Charts and Caffeine

Livewire Markets

Welcome to Charts and Caffeine - Livewire's pre-market open news and analysis wrap. We'll get you across the overnight session and share our best insights to get you better set for the investing day ahead.

MARKETS WRAP

  • S&P 500 - 3,640 (-2.11%)
  • NASDAQ - 11,165 (-2.86%)
  • CBOE VIX - 31.84
  • USD INDEX - 112.12
  • US 10YR - 3.788%
  • FTSE 100 - 6,882 (-1.77%)
  • STOXX 600 - 382.90 (-1.67%)
  • UK 10YR - 4.257%
  • GOLD - US$1661/oz
  • WTI CRUDE - US$81.62/bbl

THE CALENDAR

Source: Forex Factory

Two key reads on inflation tonight across the overseas markets. The first is the flash Eurozone CPI print (let's be honest, it's gonna be ugly) and the US core PCE measure. The latter of these is the inflation measure used by the Federal Reserve when it forecasts how much to hike or cut interest rates. Economists are expecting it'll tick up month-on-month, but given last month was just a 0.1% pop, it's entirely possible it'll be a fall too.

THE CHART

The ultimate buy the dip?

Forget buying the dip on unprofitable tech stocks on the ASX! Try buying the dip on the Hang Seng tech index! Down 70%+ this year, although a lot of it is attributable to Beijing's clamp down on big tech. I wonder if the National People's Congress will see a shift on this front. 

CHART OF THE WEEK

So you think the US Dollar doesn't matter to your investments? Or are you considering investing in some US assets because of the strong US dollar? Consider what the strong DXY actually does to the S&P 500's earnings profiles. And look even more closely at who it affects the most - info tech, industrials, energy - the kinds of sectors Aussie investors may look to for an investment stateside. 

STOCKS TO WATCH

I feel like all the brokers have gone on extended holidays! All the same, the ones who are still working have given us a couple of valuation-centric upgrades to work with.

Charter Hall Long WALE REIT (ASX: CLW) gets a bump to buy from neutral at Citi, with its asset pool being viewed as "too cheap". Having said that, the concerns over growth are still warranted despite the rents being linked to CPI. 

Meanwhile, Ord Minnett finds the 40%+ sell-down of Ramelius Resources (ASX: RMS)' shares since July to be reflective of margin pressures and a misplaced perception of deliverability risk. It's now an accumulate instead of a hold.

THE STAT

3.3%: Household wealth fell just a little in the June quarter, but Australians are still among the world's wealthiest people with an average of over $550K. (Source: ABS)

Of course, this statistic is cheeky because it's the average. Take the median household wealth figure in Australia, or even the average minus the wealth of the richest 250 Australians, and you might find something far more accurate and revealing.

Hans Lee wrote today's report. Chris Conway will write Monday's report while Hans is on annual leave.


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Charts and Caffeine
Markets Wrap
Livewire Markets

Charts and Caffeine is Livewire's daily pre-market wrap. We get you across the overnight markets and share the best in global finance so you can start your day on the front foot. Written by Hans Lee (Mondays - Thursdays) and Chris Conway (Fridays).

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