Best of the Week
Most Popular
1. 2019 From A Fourth Turning Perspective - James_Quinn
2.Beware the Young Stocks Bear Market! - Zeal_LLC
3.Safe Havens are Surging. What this Means for Stocks 2019 - Troy_Bombardia
4.Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate - Nadeem_Walayat
5.January 2019 Financial Markets Analysis and Forecasts - Nadeem_Walayat
6.Silver Price Trend Analysis 2019 - Nadeem_Walayat
7.Why 90% of Traders Lose - Nadeem_Walayat
8.What to do With Your Money in a Stocks Bear Market - Stephen_McBride
9.Stock Market What to Expect in the First 3~5 Months of 2019 - Chris_Vermeulen
10.China, Global Economy has Tipped over: The Surging Dollar and the Rallying Yen - FXCOT
Last 7 days
If You Get These 3 Things Right, You’ll Never Have to Worry About Money - 22nd Mar 19
March 2019 Cryptocurrency Technical Analysis - 22nd Mar 19
Turkey Tourist Fakes Market Bargains Haggling Top Tips - 22nd Mar 19
Next Recession: Finding A 48% Yield Amid The Ruins - 22nd Mar 19
Your Future Stock Returns Might Unpleasantly Surprise You - 22nd Mar 19
Fed Acknowledges “Recession Risks”. Run for the Hills! - 22nd Mar 19
Will Bridging Loans Grow in Demand and Usage in 2019? - 22nd Mar 19
Does Fed Know Something Gold Investors Do Not Know? - 21st Mar 19
Gold …Some Confirmations to Watch For - 21st Mar 19
UKIP No Longer About BrExit, Becomes BNP 2.0, Muslim Hate Party - 21st Mar 19
A Message to the Gold Bulls: Relying on the CoT Gives You A False Sense of Security - 20th Mar 19
The Secret to Funding a Green New Deal - 20th Mar 19
Vietnam, Part I: Colonialism and National Liberation - 20th Mar 19
Will the Fed Cut its Interest Rate Forecast, Pushing Gold Higher? - 20th Mar 19
Dow Jones Stock Market Topping Pattern - 20th Mar 19
Gold Stocks Outperform Gold but Not Stocks - 20th Mar 19
Here’s What You’re Not Hearing About the US - China Trade War - 20th Mar 19
US Overdosing on Debt - 19th Mar 19
Looking at the Economic Winter Season Ahead - 19th Mar 19
Will the Stock Market Crash Like 1937? - 19th Mar 19
Stock Market VIX Volaility Analysis - 19th Mar 19
FREE Access to Stock and Finanacial Markets Trading Analysis Worth $1229! - 19th Mar 19
US Stock Markets Price Anomaly Setup Continues - 19th Mar 19
Gold Price Confirmation of the Warning - 18th Mar 19
Split Stock Market Warning - 18th Mar 19
Stock Market Trend Analysis 2019 - Video - 18th Mar 19
Best Precious Metals Investment and Trades for 2019 - 18th Mar 19
Hurdles for Gold Stocks - 18th Mar 19
Pento: Coming QE & Low Rates Will Be ‘Rocket Fuel for Gold’ - 18th Mar 19
"This is for Tommy Robinson" Shouts Knife Wielding White Supremacist Terrorist in London - 18th Mar 19
This Is How You Create the Biggest Credit Bubble in History - 17th Mar 19
Crude Oil Bulls - For Whom the Bell Tolls - 17th Mar 19
Gold Mining Stocks Fundamentals - 17th Mar 19
Why Buy a Land Rover - Range Rover vs Huge Tree Branch Falling on its Roof - 17th Mar 19
UKIP Urged to Change Name to BNP 2.0 So BrExit Party Can Fight a 2nd EU Referendum - 17th Mar 19
Tommy Robinson Looks Set to Become New UKIP Leader - 16th Mar 19
Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - 16th Mar 19
Towards the End of a Stocks Bull Market, Short term Timing Becomes Difficult - 16th Mar 19
UKIP Brexit Facebook Groups Reveling in the New Zealand Terror Attacks Blaming Muslim Victims - 16th Mar 19
Gold – US Dollar vs US Dollar Index - 16th Mar 19
Islamophobic Hate Preachers Tommy Robinson and Katie Hopkins have Killed UKIP and Brexit - 16th Mar 19
Countdown to The Precious Metals Gold and Silver Breakout Rally - 15th Mar 19
Shale Oil Splutters: Brent on Track for $70 Target $100 in 2020 - 15th Mar 19
Setting up a Business Just Got Easier - 15th Mar 19
Stock Market Elliott Wave Analysis Trend Forercast - Video - 15th Mar 19
Gold Warning - Here Are the Stunning Implications of Plunging Gold Price - Part 1 - 15th Mar 19
UK Weather SHOCK - Trees Dropping Branches onto Cars in Stormy Winds - Sheffield - 15th Mar 19
Best Time to Trade Forex - 15th Mar 19
Why the Green New Deal Will Send Uranium Price Through the Roof - 14th Mar 19
S&P 500's New Medium-Term High, but Will Stock Market Uptrend Continue? - 14th Mar 19
US Conservatism - 14th Mar 19
Gold in the Age of High-speed Electronic Trading - 14th Mar 19
Britain's Demographic Time Bomb Has Gone Off! - 14th Mar 19
Why Walmart Will Crush Amazon - 14th Mar 19
2019 Economic Predictions - 14th Mar 19
Tax Avoidance Bills Sent to Thousands of Workers - 14th Mar 19

Market Oracle FREE Newsletter

Stock Market Trend Forecast March to September 2019

Australian Stocks Attempted to Break Losing Streak

Stock-Markets / Austrailia Jan 14, 2008 - 08:42 AM GMT

By: Geoffrey_Transom

Stock-Markets We mused on Friday if perhaps the Australian market might be able to break its losing spell this week - and it did its damnedest to do just that today, albeit after a very poor opening.

In the early part of the session, the All Ordinaries was down about 80 points - and then it turned in a ten cent piece and shot back towards the surface, lungs bursting. From a decline of 83 points it actually made it back above the unchanged level less than 90 minutes later. Pretty impressive, but also very worrying; the last thing the Australian economy needs is for its financial markets to have become the plaything for hot money.

Major Market Indices

The broad market - the All Ordinaries ( XAO ) - finished in the red, dropping 13.5 points (0.22%) to close the day at 6040.9 points. The index hit an intraday high of 6072.6 at 12:38 pm, while the low for the day was 5970.8 - set at 10:43 am.

Now read that last paragraph again - in two hours between about half-ten and half-twelve, the Ordinaries rose over a hundred points.

And what was the catalyst? Nothing. Someone decided to have a short squeeze in the SPI, is all.

One ought not complain - after all, this represents the sixth straight session of decline for the Australian market - but there is something seriously wrong when a financial market behaves like the Aust market behaved today. it is a sign that 'investors' really have no idea what they are doing. This is evidenced by the fact that once it got back to (roughly) unchanged, the Australian indices had no idea what to do with themselves. They wandered in a 40-point zigxag for the rest of the session.

Total volume traded on the ASX was a little below average at 1.5 billion units: there's your reason as to why the thing could be pushed as easily as it was during those two hours... someone spotted the soft volume, and took 'er up.

The ASX's daily listing of all stocks included 1447 different 3-letter FPO's which traded (i.e., had non-zero trade volume). Of these, 308 issues rose, with volume in rising issues totalling 435.5 million units. Conversely 881 stocks were dragged to a loss for the session, with aggregate volume traded of 834 million shares.

Of the 478 All Ordinaries components, 130 rose while 298 fell. Volume was tilted in favour of the losers by a margin of 1.3:1, with 295 million shares traded in gainers while 374.24 million shares traded in the day's losers.

The Index that forms the cash basis for the SFE's Share Price Index Futures - the S&P/ASX 200 ( XJO ) - fell mildly, losing 1.6 points (0.03%), closing out the session at 5980 points.

The "heavy hitters" of the Australian market - the ASX 20 Leaders ( XTL ) - actually managed a teensy gain for the day adding 1.8 points (0.05%), closing out the session at 3297 points.

Among the 20 big guns, 14 index components finished to the upside, and of the rest, 6 closed lower for the session. The 21 stocks which make up the index traded a total of 134.43 million units; 14 index components rose, with rising volume amounting to 88.36 million shares, while the 6 decliners had volume traded totalling 22.26 million units. The major percentage gainers within the index were

  • Wesfarmers Limited ( WES ), +$1.04 (2.74%) to $39.04 on volume of 1.6 million shares;
  • Brambles Limited ( BXB ), +$0.26 (2.54%) to $10.51 on volume of 10.8 million shares;
  • Foster's Group Limited ( FGL ), +$0.12 (1.91%) to $6.40 on volume of 5.7 million shares;
  • Suncorp-Metway Limited. ( SUN ), +$0.27 (1.76%) to $15.64 on volume of 4.3 million shares; and
  • Macquarie Group Limited ( MQG ), +$1.12 (1.6%) to $71.00 on volume of 2.2 million shares.

On the less salubrious side of the big-cap fence, the following stocks were the worst-performed within the index:

  • Stockland ( SGP ), -$0.14 (1.86%) to $7.38 on volume of 3.7 million shares;
  • Westpac Banking Corporation ( WBC ), -$0.37 (1.42%) to $25.63 on volume of 6.2 million shares;
  • Westfield Group ( WDC ), -$0.21 (1.13%) to $18.34 on volume of 4.1 million shares;
  • St George Bank Limited ( SGB ), -$0.18 (0.59%) to $30.45 on volume of 1.6 million shares; and
  • QBE Insurance Group Limited ( QBE ), -$0.1 (0.32%) to $31.50 on volume of 2 million shares.

At the other end of the market-cap spectrum lie the denizens of the ASX Small Ordinaries ( XSO ) - the place where non-mania excess returns lie. The small-fry swam in the opposite direction to the big fish today. The tiddlers stayed underwater while the Top20 posted a gain. The Small Ords slid to a much greater extent than the big caps, falling 15.2 points (0.42%) t0 3611.1 points.

Among the stocks that make up the Small Caps index, 59 index components finished to the upside, and of the rest, 126 closed lower for the session.

The 192 stocks which make up the index traded a total of 286.47 million units: volume in the 59 gainers totalling 87.93 million shares, with trade totalling 151.06 million units in the index's 126 declining components. The major percentage gainers within the index were
  • MFS Limited ( MFS ), +$0.45 (12.68%) to $4.00 on volume of 14.1 million shares;
  • Aditya Birla Minerals limited ( ABY ), +$0.28 (12.67%) to $2.49 on volume of 2.6 million shares;
  • Lynas Corporation Limited ( LYC ), +$0.12 (10.71%) to $1.24 on volume of 1.7 million shares;
  • Austereo Group Limited ( AEO ), +$0.23 (10%) to $2.53 on volume of 75.7 thousand shares; and
  • Murchison Metals Ltd ( MMX ), +$0.23 (8.21%) to $3.03 on volume of 3.6 million shares.

In the red-zone of the little-stock index, the following list represents the biggest downers (in terms of percentage decline):

  • Centennial Coal Company Limited ( CEY ), -$1.99 (40.61%) to $2.91 on volume of 2.3 million shares;
  • Resolute Mining Limited ( RSG ), -$0.2 (9.52%) to $1.90 on volume of 299.2 thousand shares;
  • Sundance Resources Limited ( SDL ), -$0.03 (7.69%) to $0.30 on volume of 45.8 million shares;
  • Gindalbie Metals Ltd ( GBG ), -$0.07 (7.61%) to $0.85 on volume of 3.3 million shares; and
  • Challenger Diversified Property Group ( CDI ), -$0.07 (7.53%) to $0.86 on volume of 612.1 thousand shares.
Index Changes

By Geoffrey Transom

GT is a private trader who lives in Central France. He was Head of Equities Research at Australia's premier independent research house (investorweb), and prior to that worked at an economic modelling think tank for 7 years. During that time he published articles related to the modelling of expectations in financial markets, and began a PhD thesis (not finished) which used a scenario-based sensitivity analysis within a computable general equilibrium model. Prior to the introduction of a new indirect tax in Australia, he advised major companies - 50 of the 100 largest companies in Australia - on the ramifications of tax mix change, and co-authored and presented papers to the Econometric Society and the Commonwealth Treasury on the modelling of financial markets in the Commonwealth Treasury's TRYM macroeconomic model.

GT predicted the CDO crisis way back in 2004 (April 29th to be precise - the relevant segment is re-quoted at /2008/01/cdorant-from-rantvault .html ) and has known that Greenspan was an idiot from about 1998 onwards.

Geoffrey Transom Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules