Thanks Endless. Good to have you back. Half-time round-up:The...

Thanks Endless. Good to have you back.

Half-time round-up:

The ASX's six-day winning run is under threat ahead of this afternoon's rates decision as the threat of European credit downgrades weighs on Asian markets and US futures.

At lunchtime the ASX 200 was down 28 points or nearly 0.7% at 4292 with all sectors except telecoms (+0.8%) in the red. The falls were heaviest in gold -2.5%, industrials -2.1% and materials -1.4%. The declines followed confirmation after Wall Street closed this morning that Standard & Poor's has placed most of the euro-zone on "negative creditwatch".

"As so often, the timing of that announcement was ripe for a bit of a pause [in the rally in equities]," CMC chief market analyst Ric Spooner told Fairfax. "Traders and investors are aware of the fact that a mean reversion was well on the cards after a six-day rally."

Asian markets retreated this morning, dragging US futures with them. Japan's Nikkei was recently off 0.78%, Shanghai 0.33% and Hong Kong's Hang Seng 1%. Dow futures were down 24 points or 0.2%.

Expectations for tomorrow's quarterly GDP report were again reined in following declines in foreign trade and government spending last quarter, the ABS reported this morning. Government spending dropped 2.5% from the previous quarter and the gap between imports and exports continued to widen.

Crude oil futures recouped 4 cents this morning at US$100.48 a barrel. Spot gold was $6.40 weaker at US$1,718.40 an ounce. The dollar was buying US$1.0238.


A predictable pullback underway but it's very restrained so far. I don't like buying the first day of pullbacks unless the opportunity is glaring - didn't need sunglasses this morning. Spend the morning sitting at buy levels that never got hit (GGP, AGS, EGO, GCN). Got a few KBL near support but no excitement there.