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MARKET OUTLOOK - Global & Local, Perspectives & General Market Feeling
blacksheep
post Posted: Nov 18 2018, 06:55 PM
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Things are looking jittery again.

QUOTE
Key points:
Equity markets in China, Hong Kong and Korea are all in bear territory, others are are close
Oil is down more than 20pc in just the past month
Analysts warn of "flash crashes" as most markets haven't bottomed

The big broker Bank of America Merrill Lynch warned its clients over the weekend that risk of another "flash crash" in markets is rising.

Its strategy team said rising volatility across a range of asset classes and the rapid winding up of speculative positions and debt in places like the oil market was a sign a bear market could have further to go.

There's a heady list of issues troubling the Wall Street investment bank, but its primary worry is the big institutional investors it deals with have yet to reach peak pessimism.

In other words BoAML's famous "Bull and Bear Indicator" is not flashing red yet and markets haven't hit rock bottom.

"Ingredients of flash crash rising ... bond, foreign exchange, equity volatility all trending up, vicious deleveraging events, dislocation risk via abnormal spreads ... triggers could be violent US dollar move and/or shock macro data forcing abrupt GDP and earnings downgrades," BoAML's dot points noted.

Its survey of big fund managers found optimism at its lowest point since 2008.

But it's not total capitulation, only 11 per cent of those surveyed thought the world would be dragged into recession next year

There's a bear in there, and there, and there...
So after charging for the best part of a decade, are the global bull markets about to bite the dust?

Since early 2009, at the depth of the financial crisis, global equities have almost trebled in value, but now the bears are out and about and have taken some sizeable chunks out of most markets.

China's CSI300 — comprising the top 300 stocks on the Shanghai and Shenzhen markets — the MSCI emerging markets index, Hong Kong's Hang Seng and South Korea's KOSPI are in bear territory, down more than 20 per cent from the peak in the past 12 months.

Germany's DAX is the next most vulnerable, down more than 16 per cent and falling.

Australia's ASX200 is back flirting with a correction, just shy of a 10 per cent retreat.

A decade of near invincibility has driven many markets and listed companies way beyond sane valuations.

Toss in rising interest rates, global trade tensions and slowing growth and bulls have got the staggers.

Significantly, two economic superpowers, Germany and Japan, are looking a bit crook, coughing up negative third-quarter GDP numbers last week.

Around half the biggest listed corporates in both countries are in bear territory. In Australia the figure is around 40 per cent, in China it's closer to 90 per cent.

.


QUOTE
Markets on Friday's close:
ASX SPI 200 futures +0.2pc at 5,735 ASX 200 (Friday's close) -0.1pc at 5,731

AUD: 73.3 US cents, 64.2 euro cents, 57.2 British pence, 82.7 Japanese yen, $NZ1.07

US: Dow Jones +0.5pc at 25,413 S&P500 +0.3pc at 2,739 NASDAQ flat at 7,260

Europe: FTSE -0.3pc at 7,014 DAX -0.1pc at 11,341 EuroStoxx50 -0.3pc at 3,181

Commodities: Brent oil +0.5pc at $US66.95/barrel, Gold +0.7pc at $US1221/ounce, Iron ore $US75.90/tonne


read more - https://www.abc.net.au/news/2018-11-18/bear...ection=business



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The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington

Said 'Thanks' for this post: early birds  
 
blacksheep
post Posted: Nov 15 2018, 09:03 PM
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Sterling, euro stocks scuttled as Brexit deal hits the rocks
Marc Jones
QUOTE
LONDON (Reuters) - Sterling tumbled and the rest of Europe’s share markets groaned on Thursday, after a long-awaited Brexit agreement was thrown into chaos as Britain’s chief negotiator for the deal quit just 12 hours after it had been unveiled.

Up until that point markets had looked relatively calm. Asia had cheered news that China and the United States were back in contact about their bitter trade dispute and oil was holding steady again having snapped out of a record losing streak.

But then came the hammer blow. London’s Brexit minister Dominic Raab quit in protest at Prime Minister Theresa May’s deal for leaving the European Union
.
read more - https://www.reuters.com/article/us-global-m...s-idUSKCN1NK03P

QUOTE
Brexit: Britain's Brexit Minister quits, triggering wave of resignations from Theresa May's Government

https://www.abc.net.au/news/2018-11-15/live...s-deal/10502726



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
blacksheep
post Posted: Nov 15 2018, 06:42 PM
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Posts: 6,376
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Commodities Are Sending a Distressing Signal
Professor Oil and Dr. Copper are suggesting all is not well with the global economy.

By Komal Sri-Kumar
November 15, 2018, 6:00 PM
QUOTE
Oil markets are sending a powerful message. After reaching a four-year high in early October, the price of crude has collapsed by more than 25 percent. This move is about more than just the ups and down of global supplies and whether OPEC and other producers can adjust. More importantly, it seems to speak to waning demand, which is worrisome.

These developments suggest the synchronized growth that the global economy has enjoyed in recent years is likely to be replaced by a generalized slowdown. Just take a look at the data out of Japan and Germany this week, which showed the world’s third- and fourth-largest economies contracted in the third quarter.


read more - https://www.bloomberg.com/opinion/articles/...nd=premium-asia



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
joules mm1
post Posted: Nov 15 2018, 11:14 AM
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AUD Unemployment Rate 5.0%

AUD Employment Change 32.8K

graph https://www.forexfactory.com/calendar.php#graph=91363



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. . . . . . . . everything has an art.....in the instance of the auction process, the only thing, needed to be listened to; price
 
blacksheep
post Posted: Nov 12 2018, 07:45 PM
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Posts: 6,376
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Why debt will be the cause of the next stock market jolt
By business editor Ian Verrender
Posted earlier today at 6:17am
QUOTE
For most investors, it was a month to remember for all the wrong reasons.

October turned into 'Shocktober' as waves of panic roiled global markets and torched most, if not all, of this year's gains.

While the fears have abated in the past fortnight, they haven't entirely disappeared. Nor should they.

For while the old adage that bull markets are built on a wall of worry is usually trotted out to placate the fearful and soothe rattled nerves, tensions within the global financial system are building, potentially grinding towards a breaking point.

There's a common feature underpinning almost every major shakeout on financial markets in recent history — debt.


QUOTE
What have American companies done with all that debt?
When Ben Bernanke hit the emergency switch and pushed rates to zero, it wasn't just to help out the fat cats on Wall Street although, as things transpired, that's exactly what happened.

In an almost identical argument to the recent one we've been having about corporate tax rates, the then-US Federal Reserve chairman reckoned that if money was so cheap banks could give it away, companies would borrow big, invest in new plant and equipment, hire more workers and quickly get the real economy back on track.

It worked, sort of. The only problem was that corporate America, while it was more than happy to borrow the cash, didn't exactly invest it all, or even that much of it. Instead, it doled out a large slice of the borrowed cash to investors in the form of dividends and by buying back shares.

Most senior executives are paid bonuses if the stock price rises. There's two easy ways to do that. One is to attract investors by forking out huge dividends. The more demand for shares, the higher the price.

The second is to step into the market and buy back your own shares, further boosting the price.


American bosses embraced the idea with glee. Borrow cash for next to nothing, hand it out to punters, watch your stock soar and reap the rewards for a surging stock price.

It was money for old rope.

As the chart below shows, this year, the bonanza to investors should top $US1 trillion, turbocharged by US President Donald Trump's recent massive round of corporate tax cuts.


Buybacks and Dividends paid vs SP500 value


All of which goes to prove that corporations will only invest if they can see a return on it. They won't invest or hire extra workers simply because they have extra cash with which to play.

The problem now is that while the resulting debt needs to be repaid, there isn't enough extra earnings capacity to cover the rising cost of all that extra borrowing once interest rates rise. And many of the executives who benefitted from this wondrous experiment have ridden off into the sunset, saddlebags packed with gold.

Little wonder Wall Street's money mandarins are getting twitchy.


https://www.abc.net.au/news/2018-11-12/why-...ection=business

see link for the Buybacks and Dividends paid vs SP500 value chart




--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
blacksheep
post Posted: Nov 11 2018, 11:37 AM
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Is Australia the next big 'Big Short' for global investors?
By business reporter Stephen Letts
Updated about 5 hours ago
QUOTE
Markets stumble again
After a pretty solid week, global equity markets stumbled on Friday on weaker oil prices and some poor data out of China.

Wall Street's S&P500 lost almost 1 per cent, but still ended the week up more than 2 per cent.

The ASX gained 1 per cent last week, but looks like giving up most of it on Monday's opening.

Markets on Friday's close:
ASX SPI 200 futures -0.7pc at 5,874 ASX 200 (Friday's close) -0.1pc at 5,921
AUD: 72.3 US cents, 63.7 euro cents, 55.7 British pence, 82.2 Japanese yen, $NZ1.07
US: Dow Jones -0.7pc at 25,989 S&P500 -0.9pc at 2,781 NASDAQ -1.7pc at 7,407
Europe: FTSE -0.5pc at 7,105 DAX flat at 11,529 EuroStoxx50 -0.3pc at 3,229
Commodities: Brent oil -0.7pc at $US70.18/barrel, Gold -1,2pc at $US1209/ounce, Iron ore $US76.90/tonne
The falling oil price while starting to trickle through to petrol pumps, is certainly spooking the market at the moment.

Lower demand for oil points to a slowing global economy, although there are supply issues as well — principally US action against Iranian exports wasn't as tough as expected.

Falling Chinese factory gate prices also could be seen as indicator of slowing global trade.

It might just be a coincidence, or something more sinister, but two of the world's biggest economies are expected to report shrinking GDP this week.

The consensus is Japan will report GDP of -0.3 per cent over the quarter (Wednesday). Germany (Wednesday) may go backwards as well.

There a fair few one-offs in both calculations, but if they were stronger they wouldn't be close to such an economic embarrassment.

Trade data stripped out of various manufacturing surveys point to an underlying weak trend around the world.

Export orders from a composite global PMI are now in contractionary territory, while most other measures are on the slide.

Currently few economists are predicting the global economy will tank, but the trade enmity between the US and China, and the US and anybody it runs a deficit with, is a worry.

Strength in the US is still keeping things afloat, but its fair to say the global economy is past its peak and the risks of slowdown are mounting.

https://www.abc.net.au/news/2018-11-11/is-t...estors/10480772



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 


joules mm1
post Posted: Nov 7 2018, 11:49 AM
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Posts: 990
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live U.S midterms for those of you thoroughly disinterested/uninterested in such 'stuff'
https://edition.cnn.com/politics/live-news/...2018/index.html




--------------------
. . . . . . . . everything has an art.....in the instance of the auction process, the only thing, needed to be listened to; price
 
early birds
post Posted: Nov 7 2018, 06:14 AM
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Posts: 12,432
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https://www.cnbc.com/2018/11/06/heres-what-...to-play-it.html

midterm election play book ?? unsure.gif




 
blacksheep
post Posted: Nov 3 2018, 01:50 PM
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In Reply To: blacksheep's post @ Nov 2 2018, 06:48 PM

Fake news?

QUOTE
The president’s remarks helped U.S. stocks to trim their losses on a day that started with market optimism over a Bloomberg report quoting unnamed sources as saying that Trump had ordered his cabinet to draw up terms for a China trade deal.But by midday, shares had turned negative, weighed down by Apple Inc.’s (AAPL.O) disappointing earnings forecast and comments from White House economic adviser Larry Kudlow that he was less optimistic than previously about a deal between Washington and Beijing.

Kudlow, speaking on CNBC, contradicted the Bloomberg report and added: “There’s no mass movement, there’s no huge thing. We’re not on the cusp of a deal.”

Trump administration officials have said U.S.-China trade talks cannot resume until Beijing outlines specific actions it would take to meet U.S. demands for sweeping changes to policies on technology transfers, industrial subsidies and market access.

Trump said that if a deal is not made with China, he could impose tariffs on another $267 billion in Chinese imports into the United States, adding that China’s economy had “been hit very hard” by previous U.S. tariffs.


https://www.reuters.com/article/us-usa-trad...e-idUSKCN1N72G6



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
blacksheep
post Posted: Nov 2 2018, 06:48 PM
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Posts: 6,376
Thanks: 2227


Global Stocks Rebound Gathers Pace on Trade Hopes: Markets Wrap
By Chris Anstey , Adam Haigh , and Robert Brand
November 2, 2018, 9:03 AM GMT+11 Updated on November 2, 2018, 7:15 PM GMT+11
Bloomberg reports Trump asking officials to draft China deal
Offshore yuan extends gains on optimism relations will thaw

QUOTE
Stocks extended gains globally, Treasuries dropped and the dollar fell on Friday as a buoyant mood swept markets on the back of fresh hopes for trade between the world’s two biggest economies. Crude oil fell.

The boost to sentiment came after Bloomberg News reported U.S. President Donald Trump is interested in reaching an agreement on trade with Chinese President Xi Jinping at the Group of 20 nations summit in Argentina this month and has asked key officials to begin drafting potential terms.

https://www.bloomberg.com/news/articles/201...nd=premium-asia



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
 


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