Afternoon trading Sep 21

Thanks Oscar and morning crew.


Half-time round-up:

Shares slumped to a three-week low as yield stocks took a hit following a hawkish policy outlook from US Federal Reserve.

The ASX 200 fell 56 points or 1% to 5653 by the halfway mark as traders dumped gold stocks -3.4%, utilities -1.9%, telecoms -1.5% and health stocks -0.8%. The index traded well below its recent support level - a close around here would represent the benchmark index's weakest finish since February.

The sell-off followed a policy update from the Fed that was broadly in line with expectations but surprised some market-watchers with its tone. The bank left its key rate unchanged but signalled a likely rise later this year, three hikes next year and also mapped out its intention to reduce its balance sheet by up to US$600 billion a year. The S&P 500 recovered to close 0.06% ahead.

"The Fed did not surprise, but the underlying signal was more hawkish than markets expected," David Plank, head of Australian economics at ANZ,told CNBC.

US equity futures signalled minimal concern. Dow futures were recently down a point or 0.01%. China's Shanghai Composite edged up 0.1%, Hong Kong's Hang Seng 0.07% and Japan's Nikkei 0.83%.

Gold was one of the principal victims of post-statement re-positioning. US gold futures were recently down $14 or 1.06% at US$1,302.40 an ounce. Crude oil futures jumped 81 cents or 1.64% to US$50.29 a barrel. The dollar was buying 79.99 US cents.


XJO looks to be breaking down out of its recent trading range. Been looking likely for a while - index has set lower highs on each of the last few rallies. 5600 to come into play in the days ahead? Trading: wonderfully busy opening flurry - nailed three quick trades in 88E, ASN and BGS, then it all went quiet.