Afternoon trading Sep 15

Thanks Oscar and morning crew.


Half-time round-up:

Australian shares sold off with other risk assets this morning after North Korea fired a missile over Japan, triggering a mild retreat to safety on world markets.

The ASX 200 declined 47 points or 0.8% to 5691, paring a winning week for the local index amid fresh records on Wall Street and easing tensions on the Korean peninsula. North Korea restirred the pot this morning by launching a ballistic missile over Japan into the sea. South Korea responded by firing its own missile into the sea.

While the reaction on world markets was more restrained then after previous missile launches, defensive assets such as gold and US treasuries ticked higher and stocks around the region mostly fell. US gold futures were lately up $5.80 or 0.44% at US$1,335.20 an ounce. The modest rise did little for local gold miners, with the sector falling 1% as the local dollar fell back below US$80, lately buying 79.97 US cents.  

"It would be wrong to say that markets are not taking any notice, but the relatively muted responses of yen, won and risk assets globally suggests that a sense of fatigue on this belligerence is creeping in" Rob Carnell, Asia head of research at ING, told CNBC.

South Korea's Kospi shed 0.44%, China's Shanghai Composite 0.32% and Hong Kong's Hang Seng 0.62%. Japan's export-dependent Nikkei edged up 0.1%. Dow futures retreated 27 points or 0.12%. S&P 500 futures lost 5.25 points or 0.21%.

Back home, the metals & mining sector gave up 2.1%, materials 2%, utilities 1.7% and energy 1%. IT was the best of the bunch, up less than 0.1%.

Crude oil futures faded 26 cents or 0.52% this morning to US$49.63 a barrel.


Market is starting to discount North Korea as a market-mover - Kim can only play the same trick so many times before people stop paying attention. The local index reached the upper band of its trading range on Wednesday and was due a retreat. Right on cue. Trading: should have been bolder on PAB at 1.5c but wanted another cent lower as a safety net. Ah well. Took BRL just after the open after reading the threads. Always worth considering a buy when the threads reach maximum outrage - sign of pending capitulation. (Not saying it's unjustified in this instance.) Out already but will likely revisit on Monday.