Daytrading June 1 afternoon

Thanks Brit and morning crew.


Half-time round-up:

Shares dropped to a one-week low this morning as a pick-up in economic growth muddied the outlook for more rate cuts and Chinese factory activity remained depressed.

At 1pm EST the ASX 200 was off 67 points or 1.2% at 5312 following overnight declines in Wall Street and warnings about risk events later in the week. An attempted rebound floundered after data showed the economy grew 1.1% last quarter, up from growth of 0.7% over the last three months of 2015 and ahead of expectations for a figure around 0.8%. Year-on-year growth of 3.1% also beat expectations. The dollar jumped more than half a cent to 72.89 US cents.

"Goldilocks economy?" Tweeted writer and former broker Marcus Padley. "Low inflation. Low rates. Good employment and 3.1% growth."

The only sectors to make headway were gold +1.5% and health +0.2%. The biggest hits came to energy -1.9%, materials -1.7% and metals & mining -1.6%.

China's official manufacturing index held steady at 50.1 last month, indicating modest growth. The final version of Caixin's rival private measure showed a mild deterioration to 49.2 from a March reading of 49.4. An official measure of services activity eased to 53.1 from a March reading of 53.5.

The market retreat came as commentators warned of potentially disruptive events later this week. “Now is not the time to buy actively," Chihiro Ohta, senior strategist at SMBC Nikko Securities in Japan, told Bloomberg. "We have events such as the OPEC meeting, the ECB policy decision and the US jobs data coming up.”

A mixed morning in Asia saw China's Shanghai Composite inch up 0.09%, Hong Kong's Hang Seng gain 0.07% and Japan's Nikkei dip 0.57%. Dow futures were recently ahead 30 points or 0.17%.

Crude oil futures eased 20 cents or 0.4% this morning to US$48.90 a barrel. Gold futures were $3.30 or 0.3% firmer at US$1,220.80 an ounce.


Rates on hold? Can't see the RBA cutting in the next few month after those GDP figures. The equity market is torn about it because while growth is obviously a positive for share prices it's a negative for lending rates. Trading: the wonderful thing about the trading life is how quickly it turns around (NB: also the worst thing about it). If traders aren't manic depressives when they start, they will be after a few years. I took a nice profit from LRS and a more modest one from LSR  (not dyslexia - one share tipped me to the opportunity in the other yesterday). Also took APY when it hit 1c in the absence of news. A week's woes washed away in 24 hours. Onwards and upwards.