Afternoon trading Feb 2

Thanks Oscar and morning crew.


Half-time round-up:

The share market extended its upbeat start to the month as a third day of gains pushed the benchmark index to a three-week high.

The ASX 200 rallied 15 points or 0.25% to 6105, earlier touching its highest point since the index reversed off a ten-year peak on January 10. Leading sectors included energy +1.5%, gold +1.3% and consumer staples +0.7%. Financials added 0.4% and materials were flat.

This morning's gains came despite signs of market nerves around the globe over the last 24 hours. Yesterday China's Shanghai Composite lost 0.97% and Germany's DAX 1.41%. This morning, Bitcoin fell below US$9,000 for the first time since November. The leading crytocurrency has lost more than half its value since peaking at US$19,511 on December 18 .

Overnight, major US indices closed mixed following another volatile session. While the Dow held on for a gain of 0.14%, the S&P 500 shed 0.06% and the Nasdaq 0.35%. Market commentators pointed to growing concerns about the impact of rising bond yields.

“The performance of the bond market has got to be beginning to flash red to equities,” Mark Heppenstall, chief investment officer of Penn Mutual Asset Management in the US, told Bloomberg. “Just the strength of rally in the equity market is going to bring the [US Federal Reserve] more and more into play this year. It seems we’re reaching a critical level on interest rates that could throw some cold water on the party in the equity market.”

S&P 500 futures were recently down seven points or 0.25%. The Shanghai Composite was off 1.28%, Hong Kong's Hang Seng 0.57% and Japan's Nikkei 1.42%.

Crude oil futures put on 27 cents or 0.41% this morning to US$66.07 a barrel. Gold futures added $3.80 or 0.28% to US$1,351.70 an ounce. The dollar was buying 80.08 US cents.



The XJO is ignoring some pretty big smoke signals from overseas this morning. Frankly, I don't know why we're up. Overall, it has been a curious performance by the local market this year. For two weeks last month the XJO hit reverse and ran around yelling "Fire! Fire!" while the rest of the world rallied to new highs; now there are signs of smoke on overseas markets, we're cheerfully pushing back towards ten-year highs - or to extend the metaphor, rushing back into the building. Go figure. Volatility is on the rise in the US. The S&P 500 has had a couple of attempts at a rebound rally but has yet to put in a convincing reversal. This feels like a possible inflection point. Trading: hasn't exactly been a banquet of opportunities this week, but I nailed a couple this morning: NZC and IVX from the lows.