Stocks fell 21% on average after first Fed rate cut since the 1970s, says Comerica
https://www.marketwatch.com/livecove...Z9PeIkFpOeqfE8
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Stocks fell 21% on average after first Fed rate cut since the 1970s, says Comerica
https://www.marketwatch.com/livecove...Z9PeIkFpOeqfE8
Don't lower interest rates mean higher stocks?
"It’s also worth remembering that humans are notoriously bad at picking market peaks and troughs – everyone from expert to amateur level. The point is that if you’ve done your research and like an investment, believing that markets are at highs is not necessarily a reason not to invest. Poor fundamentals on the other hand… "
"Fear & Greed
It’s not all a guarantee – the fear and greed index is correlation rather than causation, but you wouldn’t necessarily expect the market to nosedive tomorrow, given this sentiment. This would suggest that perhaps the current market highs are not to be feared… yet."
https://www.livewiremarkets.com/wire...rm=READ%20MORE
Sharon at ANZ says Heavy Traffic Indicator implies an ugly read for June quarter GDP
https://eu.watermarker.singletrack.i...Headers%3Dhost
Annual food prices drop for first time in six years... Hopefully the RBNZ is paying attention. First cut in August seems more and more likely.
https://www.stats.govt.nz/news/annua...-in-six-years/
Thanks, stoploss. That’s what I expected originally. Still, I have a doubt.
https://www.newstalkzb.co.nz/news/bu...term-deposits/
“The biggest drop will be to its one-year rate, dropping 25bps to 6.89% (special) and 7.49% (standard).
Westpac’s six-month rate will fall 19bps to 7.05% (special) and 7.65% (standard) and its 18-month rate will drop 10bps to 6.79% (special) and 7.39% (standard”
Fortunately, I was able to fix my mortgage at a rate of 4.9% for five years. 3 more years left for renewal.
Russell 2000 up 3.6% is confidence that inflation battle getting over ...it shud have impact on smaller markets like NZX ....expect further follow thru up move ....maybe Friday can curb some enthusiasm but surely sentiment is changing ...low hanging fruit will go faster ie +5% from lows !!!
I don't mind a bit of Government assistance...
That's if it was intervention.
The size of the move in minutes will put the market on notice. Gold also near all time highs again, we are nearing the change in cycle.
https://finance.yahoo.com/news/japan...130139783.html
Everybody excited about food prices falling as per Stats NZ report yesterday …headline stuff
But the narrative included this -
Despite the annual fall in overall food prices, the price level is the third highest since the series began in 1961. Food prices increased 1.0 percent in June 2024 compared with May 2024.
Seems food prices on way up to me
https://www.stats.govt.nz/news/annua...-in-six-years/
Lack of trucks on the road confirms economic slowdown - ANZ
An unprecedented drop in heavy traffic suggests economic growth in the second quarter could be ugly reading
https://www.rnz.co.nz/news/business/...c-slowdown-anz
I see NVIDIA reached another lower high this week.
I think Bull is right, US stock indices will drift lower with lower interest rates.
This could mask what might actually happen. Big tech driving an S&P index decline while the rest of the market recovers?
Personally I’m all for a US retracement. My core holdings are long term well diversified iUS and European funds. Any opportunity to buy cheaper is fine by me :)
I too like an opportunity to buy cheaper. My top long-term holding is a cash generator which I started to accumulate from end of 2013. Over the last 3 years I did some good trading as well. I have separated investment grade stocks and trading stocks in my portfolio. For me quality commodity stocks are also as good as other quality stocks. At some point there could be market sell-off for overvalued hot stocks of today. Mainly, my focus is for hidden gems and very attractive stocks. No value traps and growth traps in my portfolio.
Everything is all time-highs.
https://www.youtube.com/watch?v=Bq_ZP9VTtAE
Off the cuff thinking is that earnings are affected by a slowing economy. Where companies use an inflationary environment to increase prices, the consumer says enough is enough and stop spending. US companies are also increasingly international and affected by tradable costs also effecting the bottom line. Once at that point earnings are slowing even if costs are up, rate cuts are priced in and the market rotates
Thanks. I don' think so.Other than mortgage currently I’m debt free. Gradually, planning to pay-off that too. Once complete it I can make use of all my Kiwi saver, dividends and capital gain for my investment journey. Advantages of parking money in cash rich companies are nothing to worry about going concern, getting regular dividends and above average capital gain in the long run. Like those days I don’t want to lose capital by investing in all time high markets. Exception is very attractive stocks. People are paying ridiculous valuations for the hype. I can wait patiently to buy and sell stocks.
business nz services index declined again in june :scared: implying the economy gone over the cliff :scared::scared:
yeah looks like rate cuts coming sooner than prev... expect the Nats will pull back spending further into the recession as well, so should be a doozy.
Huge opportunity coming up as the economy self destructs into 2025....
Yeah if CPI stays high then RBNZ only have one mandate!!
Watch for the trimmed mean CPI ....RB uses a version of that
Usually higher than headline CPI
So tractor sales are the lowest for a month since February 2001.
Times are still tough down on the farm.
I haven't read any stats around the Field days sales this year.
add's to the very negative economic data yest.
service pmi lowest since GFC
house inventory and prices :scared:
card spending declined again + i imagine employment layoff's are probably getting started now which will show up in data late this yr which just compound the other things :scared:
china data yest was grim wont help farmers :scared:
Majority of Banks forecast first rate cut in February 2025.
https://www.oneroof.co.nz/news/banks...his-year-45799
NZ 10Y closed at 4.388% today ...High of this cycle was 5.607% we have come a long way down ...need pay more attention to real rates then forecasts ...10Y is quite a marker on rates and has high negative correlation with NZX50
No wonder today NZX50 closed at 17 months high ...NZ10Y almost close to 52 week low
https://www.nzherald.co.nz/business/...E75NOW6J5MDIE/
trump trade in full swing now
Won't he put tariffs on (bad for dow in terms of profitability).
Tech, AI and biotech will go unregulated though. Maybe it's more about inflation and interest rates?
Russel 2000 up another 3.5% ...Markets have surely made up its mind that Inflation war over ...rates are on way down ...Good on stocks ...NZ is no exception to this phenomena :t_up:
Like u said RBNZ had a good idea of whats coming ...so expecting a number around 3.5% ...anything lower will be bonus ...even 3.5% will light up our market ...10Y is going further down today ...maybe it will make 52 week low !!
PS : Russel 2000 up 11% in last 5 trading days ...wow ...leaders consolidating while rest of market including Dow catches up ...signs of long term Bull market
Russel 2000 YTD 12.4% ...last 5 days 11.1% ...just shows the value of staying invested ...timings etc is near impossible
Rate cut coming earlier than Nov!!
The number RB looks at is the trimmed mean one
Stats NZ says: The trimmed-mean measures – which excludes extreme price movements – ranged from 3.4 to 3.8 percent in the 12 months to June 2024 quarter. This indicates that underlying inflation is higher than the 3.3 percent increase in the CPI.
Whatever the number things are still costing more and we’ll never get all the price rises over recent years will be ….so pain will continue for a lot
But as long as ‘investors’ make money because of rate cuts that’s good eh
Non-tradable inflation still too high at 0.9% for the quarter and 5.4% p.a.
I expect an August cut is a less likely now.
The RBNZ needs to cut the OCR immediately. This will help my unhedged foreign stock picks in the competition.
Rotation is taking place. I kept Interest on small caps as they had low pe ratios. Generally, Institutional investors overlook small caps.Small companies start as small and later they become big. Interest rates may come down at some point but the biggest question is will sky rocketed asset prices come down to the level which can prevent bursting bubbles and major market crashes? Coming period is very crucial for markets.
Knew change of government would fix things
Nat Party on X
Inflation has fallen to 3.3%. We are turning our economy around and winning the fight against inflation.
Bravo
• Q2 inflation surprises the RBNZ to the downside again, with annual CPI inflation down to 3.3%, its lowest since mid-2021. Highly restrictive OCR settings are generating significant traction. • Non-tradable inflation has been slower to cool but this is partly reflective of cost driven influences that monetary policy should seek to look through. Stripping out some of these cost increases suggests that annual CPI inflation is already well below 3% and is rapidly cooling. • Today’s data tilts the risks towards earlier and larger OCR cuts. All remaining OCR decisions over 2024 are effectively ‘live’. In our view a 25bp OCR cut in November looks to be the bare minimum of what the RBNZ will need to deliver over 2024.
View of ASB
Do Aussie banks make more from NZ with a high OCR?
Hopefully less ripped out of our struggling economy by them.
I agree. Those who argue inflation has come down should follow chid care cost, housing rent, air fares, food prices specially in restaurants, prices in retail sector and other places worldwide.On top of that many people unable to buy their first home any longer unless they drop to the correct prices. As underline issues have not solved completely I park my money in safe places now.
From Luxon/Seymour/ Willis down the government crowing about beating rampant inflation
JFK once said “Victory has a thousand fathers, but defeat is an orphan.”
Can’t wait to hear Bradford do a rave on 1News tonight about inflation being beaten
She one passionate commentator
I've been putting further thoughts into the changing interest rate environment and what it means for US stocks.
History is a great predictor of the past.
Most interest rate reductions have been to support an ailing economy and not as a result of reduced inflation. The late 70s excluded.
The US economy is actually doing pretty well and the Fed are looking to lower interest rates when stock markets are at all time highs.
Debt isn't an issue for the mega caps that have driven this incredible rally. But consumer debt will have some relief with lower interest rates, so more to spend.
Earnings are strong & could be strengthened further with lower interest rates. So perhaps history will not repeat.
Interested in others thoughts.
US Banks doing well on back of increasing bullishness of a Trump victory. Goldman particularly been on a tear pricing in more M & A and IPO’s following a GPO win. Morgan Stanley also has doing well for the same reason. Also as they mint new wealth through capital finance they direct the recipients towards their wealth management pipeline
Quotes are good …but can get you into trouble
Like in a past life I had to do a presentation to our Australian directors about why NZ wasn’t performing as it should …like now the market had collapsed ….. really cool presentation title ‘It’s the economy, stupid’ …..Aussies have no sense of humour and are so precious it didn’t go down well and I got told off and not try to be clever in future
Took that as a compliment
Then there is this quote ..."sharemarket rises on a wall of worries".....
Yes it did this time too. There will always be something to worry about. These days I’m worry about growth stocks and overvalued stocks. Have you noticed some stocks are trading at PE ratio over 100. So, I kept only attractive stocks with strong balance sheets in my portfolio. When I was adding a small company in my portfolio recently, I made my mind that stock market is going to close for next 5 years and made sure its ROE and cash flow is going to go up. The time may be very good for value stocks and early-stage growth stocks with attractive valuation. I went one step further and looking for cash rich and good balance sheets. Any way markets are due for major correction. Remember every bubble ended up with burst.
https://businessdesk.co.nz/article/m...-29-month-high
17.7.24:
NZ sharemarket reaches 29-month high
More Media AI gone astray .. or not ? ;)
Definitely came across some of that as well.
Small minded with chips on their shoulders.
Most Aussies were good, and the woman don't seem to have the same issues.
In fact I heard from numerous Aussie women that they found Aussie men sexist and rude etc.
But I generalize.
Now a lower low for NVIDIA while the Russell 2000 soars.
Just a lazy 23.5% outperformance in a month.
Attachment 15189
https://www.marketwatch.com/investin...recentlyviewed
NZ10Y on the move DOWN ....made recent low and close to 52 week low ...this will keep NZX50 buoyant ....
If the tech sector crash SNAS will go up massively.
https://finance.yahoo.com/quote/SNAS.AX/
Global X Ultra Short Nasdaq 100 Hedge Fund (SNAS.AX)
1.3800+0.0600(+4.5455%)
Volume: 1,415,826
Avg. Volume:917,139
Put option players may have an opportunity now. In every situation there are opportunities.
https://www.nasdaq.com/market-activi...s/option-chain
Call and put options are quoted in a table called a chain sheet. The chain sheet shows the price, volume and open interest for each option strike price and expiration month.
Most Viewed in Option Chain
If it doesn't crash, your money will be f*cked very quickly in this ultra leveraged PUT. Don't take a position in this unless you've hedged against the opposite outcome, being an ultra leveraged CALL. Whichever side works out, close the loser ASAP and run with winner. Basically a Bear Put Spread.
Too risky for most 'investors' taking these bets, let alone a one-sided bet.
Thanks. I agree. First time I made use of few new things in markets. Unless those days I act fast. For example, when I saw danger signals, I sold 2 listed NZ companies very fast. One has dropped nearly 70% within the short period. Selling has become part of my investment journey. I have a trading plan and investment plan along with portfolio rebalancing. I know wealth can evaporate suddenly If they go against me.
WSJ says ‘Technology stocks sold off again on Thursday. This time though it wasn’t clear what investors might be rotating into, except perhaps cash.’
Broad US sell off overnight. Dow and Russel 2000 down, 1.29% and 1.9% respectively. Will be interesting to see how earnings season effects the sell off. Again, dropping rates is the sign of a slowing economy and earnings may reflect that
I rotated into my existing top holding with rising ROE, cash flow, a commodity producer, cash for emergency and paying off
some morgage. Winners are in. Losers are out. Always I will have something to buy and sell. Remember I said if market goes up or down, interest rates go up and down it's good for me.
Intelligent investors are waiting patiently to buy quality stocks at a fair price. Overvalued market look fragile. Still we haven't seen big sell-off. In the short term I'am bearish & in the long run bullish.
I agree. There will be some form of Wrights Law in human production. As AI and robotics improve and become more ubiquitous so will the productivity and the cost of labour making companies more efficient and profitable. I also see in the shorter-medium term a pull back in spending on not only hardware but also cap ex on in-house AI experimentation. Companies currently want to make speculative investment in POCing initiatives for both marketing and efficiencies sake but will sooner rather than later pull the pin on costs and await proven enterprise solutions. I'm bullish on the tech longer term
IMF says get used to high Interest rates.
trump convention was good
It looks like immigration control is on the cards in countries like USA, UK, Australia and Canada to control high cost of householding expenses.
https://torontosun.com/opinion/colum...ts-canada-hard
Trudeau says we're bringing in more people than we can absorb in the middle of a housing crisis and a health system under strain.
bull."trump convention was good"
How so....If you are intimating that this virtually illiterate compulsive lying profoundly disingenuous multiple bankrupt serial sexual predator narcissist reptile made any sense...please confirm.Grandiose delusional rabid conspiracy theorist racist dumb stupid person ...please confirm.
Oops ...I forgot to mention how he denigrated those Americans who had fallen in battle as saying they were "losers and suckers".
As quoted on FOX news plus others.
Carry on bull.
bull ...are flying back from that nutters convention ? A few issues perhaps with flights coming home ?.
Sorry ..how old are you.