What Mattered Today; BANG, stocks hit -85pts, Materials under the pump
BANG, stocks hit -85pts today following the weak US markets down the slide. Commodities saw most selling while the Energy names dropped out of favour. Selling was persistent and aggressive throughout the day likely signalling there is more to come - the index closed at its lowest point since June and on the lows of the day. A BIG line on the sell side went through in the last 10 mins + local futures are trading down another 12points at time of writing.
No sector managed a positive day today, but the tech sector had the most muted losses – thanks to a takeover bid for MYOB from private equity. On the other end, materials and energy were hit the worst. The big 4 took 17.4 pts off the ASX 200, while BHP’s -2.82% loss was worth -10.3 points.
Alumina (AWC) & South 32 (S32) gave back last week’s gains following the announcement the Brazilian Government granted Norsk Hydro a permit to resume operations using technology that reduces the need for runoff water that created the problem in the first place. We wrote about the shut down last week here. Below we discuss the ANZ & InvoCare downgrades, along with the MYOB takeover offer.
Overall, an interesting day with the index down 85 points or -1.38% today to 6100. Dow Futures are currently trading more or less flat, Hang Seng (Hong Kong Futures) are down -0.2%/55pts.
Broker Moves; Some conflicting views (not uncommon!!) with Morgan Stanley putting out a bullish note on Australian Resources supported largely by China’s stimulus in reaction to its trade dispute with the U.S. as well as stronger oil prices. They name RIO and Santos as two preferred picks. On the flipside, JP Morgan have cut their ratings on Woodside and Senex.
· Woodside Downgraded to Underweight at JPMorgan; PT A$37
· Senex Downgraded to Underweight at JPMorgan; PT A$0.47
· CYBG Rated New Sell at SocGen; PT 2.90 Pounds
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This is a small excert from the Market Matters Afternoon Note.
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James is Portfolio Manager & Primary Author at Market Matters, a daily investment report with over 2500 subscribers that offers real market insight. He is also Senior Portfolio Manager within Shaw and Partners heading up a team that manages...