Daytrading July 24 afternoon

Thanks Brit and morning regulars.


Half-time round-up:

The share market is flirting with a third straight loss after news of a sharp contraction in Chinese factory activity compounded pressure on resource stocks and knocked the dollar down to a six-year low.

At lunchtime the ASX 200 was trading 20 points or 0.4% lower at 5570 after an early rally faded. Gains in utilities +0.2% were dwarfed by falls in gold stocks -5.6%, metals & mining -1.2%, materials -1% and consumer discretionary -1.1%.

Chinese manufacturing activity contracted this month at the fastest pace in 15 months, according to preliminary figures from Markit. The flash purchasing managers' index fell to 48.2 from 49.4 last month, dashing economists' expectations that recent stimulus measures would lift the index to 49.8. Read more here. The Australian dollar slumped roughly half a cent on the news and was lately buying 73.02 US cents a level last seen in 2009.

China's Shanghai Composite took the news in its stride, rising 0.24%. Hong Kong's Hang Seng dropped 1.06% and Japan's Nikkei 0.69%. Dow futures were recently down 11 points or less than 0.1%.

Spot gold tumbled $13.70 this morning to US$1,080.40 an ounce. Crude oil futures rallied 28 cents to US$48.73 a barrel.


Another nasty downleg in gold this morning. Explains the heavy selling among our miners. Before giving up on them, it's worth checking out this chart of gold in Australian dollars to understand why our miners have outperformed overseas peers. It's a matter of whether the dollar can fall faster than the gold price. So far the buck has kept pace pretty well. Trading: took a couple of regulation bounce opportunities in IFM and TSE (2nd day in a row). Also had a look at DSH, which has yet to do anything.