ASX Futures (SPI 200) imply the ASX 200 will open 181 points lower, down -2.8%.
Wall Street was a sea of red as inflation fears intensified, the Fed might have to tighten as much as possible to get prices under control, Beijing lockdowns likely amid dozens of new covid cases, cryptocurrencies crash and yields are surging like its 2007.
Let’s dive in.
Tue 14 Jun 22, 8:39am (AEDT)
Name | Value | Chg % | |
---|---|---|---|
Major Indices | |||
S&P 500 | 3,750 | -3.88% | |
Dow Jones | 30,517 | -2.79% | |
NASDAQ Comp | 10,809 | -4.68% | |
Russell 2000 | 1,715 | -4.76% | |
Country Indices | |||
Canada | 19,743 | -2.63% | |
China | 3,256 | -0.89% | |
Germany | 13,427 | -2.43% | |
Hong Kong | 21,068 | -3.39% | |
India | 52,847 | -2.68% | |
Japan | 26,987 | -3.01% | |
United Kingdom | 7,206 | -1.53% |
Name | Value | Chg % | |
---|---|---|---|
Commodities (USD) | |||
Gold | 1,815.60 | -0.88% | |
Iron Ore | 140.34 | - | |
Copper | 4.198 | -0.33% | |
WTI Oil | 120.72 | -0.17% | |
Currency | |||
AUD/USD | 0.6928 | +0.10% | |
Cryptocurrency | |||
Bitcoin (AUD) | 33,128 | -16.64% | |
Ethereum (AUD) | 1,770 | -17.16% | |
Miscellaneous | |||
US 10 Yr T-bond | 3.366 | +6.65% | |
VIX | 34 | +22.59% |
Markets
The Wall Street heatmap was red enough to keep your hands warm. The Fed has lost its credibility to keep inflation under control, now stuck between sending the economy into a recession or stagflation.
Uncertainty with just how aggressive the Fed will get with interest rates, a new covid outbreak in Beijing, the ugly inflation report last Friday and surging bond yields is painting a very dark picture for equities.
The US 2-year Treasury yield is up 55 percentage points (20% rally) in the last two sessions to 3.37%, the highest since December 2007
The 2-year has staged its biggest one-day increase since the week Lehman filed for bankruptcy
The expectations of a 75 bps rate hike on Thursday has hit 85% (Zerohedge)
All 11 US sectors declined
All S&P 500 companies closed in red, the first time since 1990 (Bloomberg)
S&P 500 P/E ratio has fallen to below 18 for the first time since 2018
The median PE since 1988 is 18.4
Consumer staples was a relative ‘safe-haven’, down -2.2% compared to -3.9%
Energy, real estate, discretionary, utilities and tech sectors fell more than -4%
86% of US stocks declined
77% of US stocks trade below their 200-day moving average (69% on Friday, 66% a week ago)
Stocks
Oracle (-4.5%, after hours: 11.6%) beat earnings estimates, posting moderate growth in cloud services and licence support
“We experienced a major increase in demand in our infrastructure cloud business - which grew 39% in constant currency. We believe that this revenue spike indicates that our infrastructure business has now entered a hyper-growth phase,” said CEO Safra Catz
Tesla (-7.1%) is among several beaten-up tech shares that sold off heavily overnight
DocuSign (-10.3%) is now down -32% in the last two sessions. The eSignature tech company missed its first-quarter earnings and cut its growth guidance last Friday
Coinbase (-11.4%) shares are under pressure amid a broad-based cryptocurrency selloff. Bitcoin was down almost -20% over the weekend, below US$23,000
Economy
US inflation increased 8.6% on the year in May, a fresh 40-year high
Beat economist expectations of an 8.3% rise
US core inflation (excludes volatile food and energy components) rose 6.0% from a year ago
Commodities
Iron ore futures softened on Monday due to depressed market sentiment after fresh cases of covid emerged in Beijing over the weekend, sources told Fastmarkets
Oil prices remain unchanged despite the overnight carnage, reminding investors that energy markets remain extremely tight
Gold prices are under pressure as traders reassess more aggressive interest rate hikes to get inflation under control
Tue 14 Jun 22, 8:39am (AEDT)
Sector | Chg % |
---|---|
Consumer Staples | -2.18% |
Financials | -2.95% |
Health Care | -3.01% |
Industrials | -3.03% |
Materials | -3.92% |
Communication Services | -4.43% |
Sector | Chg % |
---|---|
Information Technology | -4.47% |
Utilities | -4.63% |
Consumer Discretionary | -4.66% |
Real Estate | -4.78% |
Energy | -5.13% |
Tue 14 Jun 22, 8:39am (AEDT)
Description | Last | Chg % |
---|---|---|
Commodities | ||
Gold | 174.54 | -2.64% |
Lithium & Battery Tech | 72.53 | -2.80% |
Silver | 20.19 | -3.42% |
Aluminum | 56.76 | -3.44% |
Strategic Metals | 93.53 | -3.89% |
Copper Miners | 38.46 | -5.28% |
Steel | 58.36 | -5.59% |
Nickel | 36.285 | -6.20% |
Uranium | 21.95 | -7.88% |
Industrials | ||
Aerospace & Defense | 100.23 | -3.74% |
Global Jets | 18.21 | -6.86% |
Healthcare | ||
Biotechnology | 110.48 | -4.08% |
Cannabis | 18.18 | -8.80% |
Description | Last | Chg % |
---|---|---|
Cryptocurrency | ||
Bitcoin | 17.95 | -20.22% |
Renewables | ||
Solar | 73.44 | -6.28% |
CleanTech | 14.41 | -7.29% |
Hydrogen | 12.91 | -8.21% |
Technology | ||
Video Games/eSports | 51.06 | -4.96% |
Cybersecurity | 25.58 | -5.28% |
Electric Vehicles | 23.3 | -5.67% |
Robotics & AI | 22.31 | -5.74% |
Semiconductor | 389.3 | -5.77% |
E-commerce | 17.81 | -6.22% |
Cloud Computing | 17 | -6.41% |
FinTech | 22.88 | -6.42% |
Sports Betting/Gaming | 15.62 | -7.55% |
The ASX will have to digest two god-awful US sessions after the public holiday on Monday.
Respect risk and stay safe out there. You can walk away from the screens whenever.
Beaten-up tech names headlined losses, serving as a reminder that if something is down -90%, it can still fall another -90%. Major overnight losers include:
Draftkings -15.8%
Block -12.6%
Affirm -12.3%
Nvidia -7.8%
Tesla -7.1%
The Global X Uranium ETF was one of the largest decliners among the ETFs we track, down -7.9%.
Uranium spot prices dipped -4% to US$49/lb according to fuel brokers Numerco.
The US Global Jets ETF dipped -6.9%, now trading around November 2020 lows - this was a few months before the vaccine was developed.
Airfares in the US rose 12.6% month-on-month in May, according to the US Bureau of Labour Statistics. Prices are up 37.8% compared to a year ago.
Copper prices are down -4.1% in the last two sessions, reflecting a gloomy economic outlook.
From a technical perspective, copper remains within its longstanding trading range, between US$4 and US$4.7.
Oil prices remained unphased amid the carnage, holding at US$120 a barrel.
"The EIA reported that 119 companies only spent US$244 billion on E&D in 2021, which is 28% less than before COVID average levels," said Oanda senior market analyst, Ed Moya.
"The oil market is still very tight as the crude demand outlook remains strong, while supplies are razor thin. Eventually crude demand destruction will occur, but that is not the story today nor will it be until later in the summer."
ASX corporate actions occurring today:
Ex-dividend: CIM, KMD
Dividends paid: AMC, KKC, WHF
Listing: KNG
Issued shares:
Other things of interest (AEST):
Australia NAB Business Confidence (May) at 11:30 am
UK Unemployment Rate (April) at 4:00 pm
US Producer Price Index (May) at 10:30 pm
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