Thanks Beany and morning regulars. Half-time round-up: The share...

Thanks Beany and morning regulars.


Half-time round-up:

The share market has taken its heaviest tumble in three months as investors dumped yield plays in anticipation of rising rates in the US.

At lunchtime the ASX 200 was 73 points or 1.2% weaker at 5826, the index's steepest decline since a 90-point slide on December 9 last year. The gold sector sagged 4.3%, property trusts 2.9%, utilities 2.6% and energy 2.1%. The metals & mining sector fell 2.1% as a rally in the US dollar made dollar-denominated commodities more expensive for holders of other currencies.

The slump followed a sharp retreat on Wall Street on Friday as strong jobs data increased the odds that the Federal Reserve will raise interest rates by the middle of the year, dulling demand for alternative assets, such as yield stocks.

The jobs data “should play out in terms of further weakness in stock markets,” Richard Gibbs, economist at Macquarie Group, told Bloomberg. “Those expectations of normalisation of interest rates were brought forward again. A lot is going to rest on what is said or is not said by Fed officials in the US this week.”

Asian markets followed Wall Street lower as US equity futures remained negative. China's Shanghai Composite dropped 1.13% and Hong Kong's Hang Seng and Japan's Nikkei were both off 0.79%. Dow futures were recently down 15 points or less than 0.1%.

Crude oil futures cents retreated 19 cents or 0.4% this morning to US$49.42 a barrel. Spot gold bounced $1.30 to US$1,170 an ounce. The dollar was buying 76.99 US cents.


CMY looks like a pretty fair example of why it's hazardous to buy shares that have rallied strongly into an announcement - too many in profit and waiting to cash out when the announcement is finally made. Plus PYL  probably left a bitter taste in a few mouths. (Bitter PYL to swallow. Boom boom.) Not that I'm in a position to offer trading advice this morning. Made a right pig of this so far. Expected weakness in the yield plays but not this much - underwater on APA and SGP. Made money on SXL on Friday, so went back in today - also underwater. Took RRL more as an overnight hold - looking for a 'day 2/3' bounce but would rather be ahead on it than... underwater. Glug glug.