DT March 23 afternoon

Thanks gang all for the thumbs, yesterday. Humbling. Take today off.


Half-time round-up:

Shares struggled to make headway today despite upbeat US equity futures ahead of a key congressional vote in the US tomorrow morning (Australian time).

At 1pm EST the ASX 200 was 13 points or 0.2% ahead at 5697. Today's tight, range-bound session followed a plunge of 90 points or 1.6% yesterday, the index's heaviest fall of the year, as traders fretted that a Republican health bill faces defeat in Congress, delaying tax cuts flagged by President Trump.

"The fact that they are having trouble with [overturning Obamacare] casts a shadow over the tax cut and the tax cut was supposed to be the principal fiscal stimulus for the improvement in real GDP," Byron Wien, vice-chairman of Blackstone Advisory Partners in the US, told Fairfax. "Without that improvement in GDP, earnings aren't going to be there and the market is vulnerable."


"We know the Republicans hold 237 of the 430 seats in the House and effectively need 216 votes to get the required majority," IG strategist Chris Weston told Fairfax.  "However, Alyssa Farah, spokesman for the Freedom Caucus, the collective who want Obamacare to be completely torn apart and reworked, has suggested that they have 25 hard 'no' votes and Trump... cannot afford more than 21."

Dow futures bounced 42 points or 0.2% this morning following a mixed close for Wall Street's major indexes overnight. China's Shanghai Composite and Hong Kong's Hang Seng both edged up 0.28% and Japan's Nikkei 0.02%.

Crude oil futures improved 32 cents or 0.67% this morning to US$48.36 a barrel. Gold futures retreated $3.80 or 0.3% to US$1,249 an ounce. The dollar was buying 76.65 US cents.


The US congressional vote on healthcare could take place during tomorrow's session here, making for a tricky day's trade. Hard to believe renegade Republicans will scupper their party's own bill, but queerer things have happened. It's also possible that GOP leaders will postpone the vote until the renegades wrangle more concessions - that would likely be seen as a negative, because the longer this takes, the longer Trump's tax cuts are delayed. Back home, worth noting that we are this week seeing the first results of 'activist shorting' on the ASX: QIN is under attack. HVN also came under indirect pressure earlier in the week. We're likely to see a lot more of this as US hedgies look for fresh opportunities in Asia/Australia. Trading: squeezed something out of EPT and CNJ.