fed just saying during there press conference repo operations not changing until april now.
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fed just saying during there press conference repo operations not changing until april now.
nasty night on US markets so far
the month of january has been turned on its head due to corona virus most likely. after looking like a great month mid month % wise us markets are on verge of posting negative january month except the nasdaq.
safe haven buying is evident with the 10 yr , utilities and gold both up % wise for the month
barometers to future gdp growth have declined during january with oil , copper and the flattening of the yield curve on some parts and inversion in others again signalling possible slower growth ahead.
mentioned in december US stock market was at risk of a fall in january due to overbrought levels guess the corona virus was the catalyst for the correction we are now experiencing. how long it lasts or goes probably be totally dependant on how long or how big the virus goes i guess.
NZ and Aus stock markets had boomer mths except virus affected industries , so be interesting how they trade in feb. asx and nz seasonally normally has have a good feb probably due to dividend chasing i reckon. but with a wild card virus out there who knows these things can sometimes throw spanners in the works.
prudence is my answer.
next week we have china re - opening on monday looks like a 8 - 9% fall will happen at this stage.
also in the us markets iowa bernie sanders result worth watching
and of course the virus needs to be watched if it keeps going up cant be good
Bull...agree, its good to be prudent and manage risk. Good post.
weekend futures implying a big fall in us stocks for monday already at this stage
4 weeks away till ATM results, a long time if the market gets a panic. No-one wants anyone being bug crushed, though I expect a gap down open tomorrow, could even look to close the gap at 13.15 in next few days. A2M will lead the way, but ATM still has a couple of hours to thrash around before ASX opens.
The futures closed implying very little about Monday. The -560 is the futures reflecting Friday's fall not an extra fall etc. hard to say what the market will do Monday.
The he biggest problem is trusting China's numbers which seem very controlled with about 45 deaths and 2,000 new cases each of the last 3 days. Seems a bit too convenient.
getting our reaction rally be interesting to see how it plays out over the week ,
this guy reckons dont buy the reaction
Economist Mohamed El-Erian is warning investors not to buy declines in the stock market like they might have done before the coronavirus
“It is big. It’s going to paralyze China. It’s going to cascade throughout the global economy
https://www.cnbc.com/2020/02/03/el-e...tock-dips.html
anyway looks like the best hedge on the planet today is tesla lol
The trouble is that the sp isnt dropping in nz due to the virus, its the reaction of the govt damaging tourism and logs etc. So I don't think that nzx will see such a bounce back to the previous highs.
Lew the way it works, is the govt follows the advice of our public health experts, & they would be foolish to ignore their advice.
To suggest the NZ share market drop is nothing to do with Coronavirus, but because the govt has set out to 'damage tourism and logs etc' is simply beyond comprehension.
There's no need to politicise everything, what would you have them do?
We followed Australia & the US by 1 day.
They have to walk a fine line between protecting the country from the virus without overreacting.
It's deeply complex & difficult, some of it (like the log exports) completely beyond our control but so far they seem to have got it about right.
tesla going parabolic lol
Yeah, I'm not having a go. Im just saying, that's the reason. To clarify: someone asked if the sp drop was due to coronavirus. imo the sp is going down due to the damage from the govt decision to block tourists, logs, etc. Not due to concerns of the virus killing off the world's population or making people so bed ridden that they can't get out buying stuff. So, if the virus was deemed to be less damaging than thought or cured, there would still be damage to the balance sheet; hence i don't think it will recover too previous highs.
I did ponder what I would do if it were me in charge. It's an ethical black hole that goes deeper and deeper the more you think about it. Then i realised that I'm not in charge, and I can't change anything, and I don't have to think about it. So i stopped thinking about it.
PS: kind of sick of people taking what i say, turning it into something different, then having a go at me for the thing they just made up:
"...the govt has set out to 'damage tourism and logs etc' is simply beyond comprehension..."
Rude and stupid.
Classic black swan event. From a market perspective alone it's timing could not be worse. The market has been looking for a reason to turn, it may have found it.
Hey Lew, apologies, I misinterpretted what you meant & should have been more careful with my choice of words.
It's just I get a little irritated seeing comments on here blaming the govt for being asleep at the wheel & at the other extreme for over reacting, politicising the whole thing when we know it's extremely complicated, working on incomplete information, & any action or response comes with a cost just as doing nothing also has big risks.
Ministers are taking best advice from public health experts, walking a fine line between protecting us from an outbreak while trying not to antagonise our main trading partner & cripple the economy. Impossible, opposing goals!
Anyway this hot weather diabolical, little sleep, feeling a bit grumpy this morning, hope there's no hard feelings.
BTW surely our govt hasn't blocked the logs? I wouldn't know but assumed that was from China?
(Just read in the Gisborne Herald, the reason exporters have stopped buying logs is because there's not enough people at work in the ports in China to unload them from the ships when they arrive, due the Chinese govt extending the New Year shut down period. Nothing to do with our govt. )
tesla up another 15% lol these momentum surges are insane haha
For those who like cartoons
China distribution chains have all slowed down as there's no-one at work - no-one to drive the forklifts, do the customs entry, manage the warehouses. Impacts very rapidly on NZ (and Aust) across multiple industries, more so than European economies. eg Coolstores are full of NZ/Aust meat = new shipments are being delayed, discounting in NZ supermarkets to clear at least some volume, and the coolstores in both NZ and China are needed for the fruit season just getting underway (eg Kiwifruit).
Should be a good day on the NZX today
rally seems to be back on in US markets , correction seems to have been short lived as mentioned in the post above and highlighted by the words moment it really did only seem like a moment for US markets.
Not surprising i guess china accounts for a small % of economic output for the US compared to a country like NZ where it accounts a much larger % so it would really only have a big impact in the US if it spread there.
For countries like NZ and AUS the impact is much more than the US mainly because of there dependence on china for trade.
NZ can compete - I have had chats with the GM of one of the biggest private owners of forests in NZ.
The problem is that most in the industry here think short term, are not prepared to invest in new plantings as they are over-geared, the over-gearing means that they cannot endure short term market upheavals and as the GM commented, are not able to hold back from harvesting when prices are not right.
Trees keep growing - they do not have to be harvested!
As for long term supply contracts, most NZ players think that they are God’s gift to trading so they do not lock in long tw contracts. Recipe for disaster.
I am not sure it is that simple.
For instance, trees keep growing but we have set up our mills so that they only process small logs!
Not that local mills compete too well with high log prices so forest owners don’t look after them and then when the international market crashes we suddenly have no local option.
I haven’t noticed the overseas owners being too afraid to ramp harvesting right down when it suits them.
However the local MDF plant is reportedly suffering little from the China situation with plenty of orders coming through still. If we weren’t a third world country we would not be sending any logs off shore unprocessed.
I can only pass on the comments from the GM who I have dealt with for over 20 years - one of those straight up individuals and not one to suffer fools easily.
They allow the trees to grow not to be harvested in NZ but to be exported later when prices are right.
Asked him why NZ exports so much of our logs, he has a simple reply - what are NZ radiata pine good for? They are not high value timber which can be used for furniture or flooring so further processing in NZ at our high costs simply do not make sense.
This is what happens when investments are made with short term horizons.
I was in Cambodia a few years ago and the government there was planting teak which takes 50 years to 75 years to reach maturity! Will never ever happen in NZ!
I agree with you about radiata being rubbish timber and would rather see a more visionary approach. But we in NZ aren’t real good at seeing past a quick buck which is why we sell our fruit trees to places like South America that will never make our locally produced fruit redundant.
That said, someone must be doing something with the trees we export (like making pallets?) or as they are locally, making MDF (which another boat load of leaves today for Japan).
On the bright side for local timber exporters - to add to the Chinese related virus issues you also now have Australia looking to ditch a bunch of fire damaged trees before they become bug infested too.
And paper, perhaps? After all, it was the abundance of radiata pine planted in the central North Island that was the impetus to build Tasman's plant at Kawerau and NZ Forest Products' at Kinleith all those years ago.Quote:
That said, someone must be doing something with the trees we export (like making pallets?) or as they are locally, making MDF (which another boat load of leaves today for Japan).
us markets approaching key targets 30 k dow
The epidemic has negatively impacted the overall China economy, especially the retail and service sectors,” said Wu in a conference call after the results. “While demand for goods and services is there, the means of production in the economy has been hampered by the delayed opening of offices, factories and schools after the Lunar New Year’s holiday.”
https://www.bloomberg.com/news/artic...d=premium-asia
from alibaba results
At this stage black monday only for NZ. potential for double top or trading range developing
Record number of call options bought last week in US ...whatever that signals
SP500 consolidating 3391 -3354
watching the US 10yr very close to smashing the near 10 yr support level :scared:
sp 500 broke down from the consolidation , gold going parabolic as mentioned it would start of week , US 10 yr flirting with 10 yr lows on huge support line at the moment. things are getting interesting.
Not typically with you ... but I agree that the combination of the recent virus news (spreading now in war torn regions of the middle east) together with the recent confirmation of human stupidity and selfishness from the Ukraine might well offer us next week some real revaluation opportunities in the markets.
Negative hype i.e. fear well might take over the markets - glad I did hold on my Strong Bear :);
DOW up 0.43% for the year
S&P500 up 2.45% for the year
Meanwhile the NZX50 is up 4.4% for the year. We've been quite sheltered from the Coronavirus stuff, I still stunning we haven't had a single case. I'm quite surprised that earnings have been strong over here so far this year as well, my hope for bargains rearing its head is slowly dwindling and I've been considering putting my money in a index tracking fund in the interim (ie FNZ)
Obviously - nobody knows what's around the corner, but somehow I think it feels at the moment more like observing the last hurray of a dying bull than the first green shoots after a long winter ...
No matter how serious this virus turns out to be for humans - sorting out the logistical issues human overreaction created already will take at least some months with reduced economic activity on a world wide scale. Can't really see how New Zealand will manage not to get affected.
Not sure whether this is the best time to start index tracking, but hey - I've been wrong before :);
You would strongly suspect once the pandemic is announced there will be some plan in place to keep the markets propped up.
futures prices on most markets opening 25 mins give an indication on peoples thinking for the week ahead
looking pretty red for US markets tonight at the moment >1% falls forecast. gold up another $20 odd , watch the 10yr closely
futures tanking more now after china had press conference saying there will be economic impact.
Quite a gnarly day on the markets today and Aussie got belted with the ugly stick too.
Dow futures currently down ~ 380 points so not looking good for tomorrow.
It won't be so much fun fishing off the wharf ? Might pay to keep a bit of powder dry and go and charter a nice boat in the Marlborough sounds and take a break from the market next week.
Market has enjoyed a fantastic run for the last 11 years, especially a stellar year in 2019 and even the first bit of 2020. Sometimes it just pays to sit back and accept that the tide doesn't always come in (if you'll excuse the expression), and maybe this black swan event marks the turning of the tide...i.e. the market is now just starting to behave rationally to the likely significant global and local economic fallout of this new virus.
This old dog is too tired to swim against the tide, its too much hard work especially seeing as my preferred swimming technique is dog paddle :D
European sell off - German Dax and British Ftse100 down by over 3%.
dr beat me to it above...
"An interesting reading from the Ifo Institute in Germany: its widely followed business climate indicator has actually beaten expectations – a reminder, perhaps, that the much of the coronavirus’s financial effects so far are down to fear, uncertainty and doubt.
The Ifo’s business climate reading came in at 96.1 points, compared with a Reuters consensus forecast for a fall to 95.3. The institute is sticking to its first-quarter growth forecast of 0.2%. Ifo president Clemens Fuest said in a statement:
The German economy seems unaffected by developments surrounding the coronavirus." The Guardian
- so not all doom and gloom in Europe this morning.
A little bit of rebalancing every now and then not the worst thing. Funny how quickly sentiment can change, in a week it could be back to full steam ahead. 700 point drop at the open for the dow, nasdaq is worse on a % equivalent.
I'm hoping for a bit of a lull period at least a quarter or two of sideways or slight downwards movement.
Its funny , while I agree sentiment changes quickly (in the big picture), I've also been amazed how slowly it turns (in the little picture).
There was time to get out re coronavirus.
I personally didn't act on it much coz I already was very underweight, and had been skimming off the tops already.
But today was quite nasty with most stocks down (apart from Chorus!!) I hate that share lol, it shouldn't be doing so well coz I bagged it hahah.
looking very ugly open
looks like its going to open on support , if doesnt hold im looking for around 3218 area
change bro open under support now still 3218 ?
just hit 3218 if doesnt hold this gonna get super ugly
Still not bad in the grand scheme of things, you shouldn't be worrying about where stocks will be in 5 days, or 5 weeks or even 5 months unless you're a short term investor.
Even at the lowest level of the day, the NZX50 was still higher than the start of the year, still up 27% for past 12 months. Expect a recover with the futures up 200 points.
I'm interested to see what happens to people if stocks are down for a few months on end and what the reaction is. A lot more people are getting into index funds now then ever before.
Had my kiwi saver in the lowest possible risk for a few years in anticipation of this event should have happened years ago...
DOW going to 20,000 imo...
Fully cashed up now...
All crypto tethered
:cool:
.^sc
not as simple as you say. as a long term investor you can still lose terribly by buying at expensive levels. did you know even buffett has been selling apple in q4 on the way up even he sells when values are stretched.
The index funds have pushed indices up they will do the same on the way down. the only reason the markets rallied from november last year is fed qe so its built on quicksand now. they cant keep printing forever. buybacks cant keep happening forever.
I had been saying dow 30k as a target for nearly a couple years we got within 500pts to the target so close enough for me. probably pass it one day but fundamentals and technicals suggest to me thats the cycle for now if im wrong so be it.
Anyway the continued bond yield flirtation with inversion suggests recession is coming or at the least a sharp slowdown , the virus probably the catalyst as it spreads around the world.
money printing and buybacks will support the market but buybacks will likely end first as company profits are dented due to slowdown and the fed is on a continuing review on there qe till april at the moment.
If you think NZ is immune i laugh NZ market follows Wall st always has and always will.
Be interesting if etf's and kiwisaver funds become net sellers. Not sure if the general public pay enough attention or have the knowledge to change to cash or fixed interest.
There won't be many buyers in that case as active funds have been killed off by and large.
bollocks Ratkin- New Zealanders are one of the most outward looking people in the world in my experience- we are so isolated we have to be. Inward looking try USA or even Aus.
kiwisavers funds follow there mandate and just keep investing to the mandate they have no emotion in regard to your returns. ETF invest based on fund flows so are forced to sell or buy based on funds flowing in and out of the funds. in a panic they are forced to sell no matter what the price as an extreme example. So yea etf are a big wild card for sure
Mayday...mayday..mayday...
Well, hope everyone is well-positioned.
Plenty enough warning about what is happening.
A man-made market downturn underway.
People are still in delusion...market is not at worst yet...people will buy in dips...wait till April n May..when the pandemic got worst n reports are in red....the lala land is kaput....
Not yet balance...at least end of year...what do u think?
I partly disagree insofar as NZ compares to other Anglophone countries. In my experience, people in NZ are less insular. For a start more than 25% of people were born overseas. I think Australia has a similar percentage of overseas born people too. The people of England, despite its previous membership of the EU, are much more inward-looking, especially outside London. It seemed to me that for many in the US, foreign news is what occurs outside their state, let alone outside the USA.
A small percentage of Kiwis may notice their KiwiSaver decline. A lot more will take notice if house prices decline.
Very hard to predict ... but I am pretty sure that a lot of reserve banks will soon flood the markets with cheap (or free) money - China will do that, Trump land of course (he wants to be re-elected, you know) and the ECB will no doubt follow.
I recon that any recovery will be sooner than that - and both equities and property prices will continue their relentless rise ... until the debt bubble bursts.
CDC in america issued warning to americans today to get themselves prepared for virus
U.S. health officials issued a strong warning about novel coronavirus on Tuesday -- that it's no longer a matter of if, but when it will spread in the U.S., and that Americans should prepare for a "significant disruption.
https://abcnews.go.com/International...ry?id=69190968
so markets wont improve until a cure is found or the virus is worldwide contained
Good news - not everybody is scaremongering:
https://www.theguardian.com/world/20...red-a-pandemic
Quote:
The director of infectious diseases and immunology at the Menzies Health Institute in Queensland Prof Nigel McMillan, said it was concerning to see media reports over-sensationalising what a pandemic might mean.
“We don’t wish to induce panic food or petrol stockpiling, when for 95% of the population, this will be a mild cold,” he said.
Love it...when US said the human trial in 6 weeks... yesterday Trump said the vaccine is not far away...them white house said...oh the president meant Ebola vaccine....what a bunch of bull crap...
Uncle Sam is trying to save the market...well we will see the market back to record again then
ranges on us markets markets are insane this week just like the bags under my eyes at the moment lol watching 3000 sp500 now around the level of oct/nov last year when the latest fed induced artificial rally started. keep eye on 10yr bonds breaking decisively below long term support will tank stockmarket in my opinion. funny how trump wants to censor info on virus too
And some thought they were buying into a relief rally in the USA mkts last nite, such volaitility in one day , DOW up 461 then ends in the red -64 atm and down 2,000 points overall, 5th straight day of losses, down 7% this week.. Green stocks were Apple, Pfizer, 3 M,Microsoft. Laggards Walt disney, Exxon, Mobil, DOW.(source CNBC)
What sorta trading were you doing in the night Bull?
yep just edited it but you were too quick;)
us futures looking pretty bad at the moment >1% falls forecast , europe looks even worse
Strong Bear waking up and smashed already through the MA 100 ... up to higher highs!
Attachment 11066
.... just look at this volume ...
10m ago08:31The European markets are a sickly sea of red this morning. - The Guardian
Reminds me of the good old days in 2008/2009
see of red first US case virus confirmed us markets could fall 20 - 30 % easliy i reckon if virus spreads in US
I really hope people heard all our argument here n not buy during the last couple days dips, hoping for market to bounce back. The market has not seen the worst yet..this is just a begining.
i agree worst maybe still to come if virus keeps spreading becomes a supply side shock , monetary policy not really good for that. rate cuts dont make you want to fly or go out to dinner. only be more juice for the drug induced market to rally more. so i hope they dont cut rates everywhere again to feed the bubble.
anyway we bounced of the around 3000 level sp 500 we mentioned couple days ago to watch so nice bounce if it only ultimately means a temporary bounce.
Is the US debt bubble about to pop... geeze it's at bubonical plague levels... debt to wealth ratio $1400 for every $1 of wealth lol...
Debt per citizen $72,326 ... debt per tax payer $188,957... us national debt 23.3 trillion dollars...
Check out the numbers here
https://www.usdebtclock.org
:cool:
.^sc