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31 Aug 2015 (AFR) – US bond market points to more volatility ahead

(31 August 2015, AFR, p21, by Karen Maley ) ‘After last week’s violent gyrations, investors could be excused for hoping that global markets might settle down to a period of tranquillity. Unfortunately, that’s not the signal emanating from the world’s most liquid market – the multitrillion-dollar US bond market.’ Read more at AFR.com (might need AFR … Continue reading

31 Aug 2015 (AFR) – Government delays behind BBY’s $16m disaster (opinion)

(31 August 2015, AFR, p18, by Patrick Durkin, opinion) ‘The federal government’s repeated failure to fix a legal loophole could cost the clients of collapsed stockbroker BBY up to $16 million. Following the collapse of derivatives broker MF Global in 2011, the former Labor government promised to move quickly to ensure client funds could never … Continue reading

31 Aug 2015 (AFR) – On second thought, China slowdown will hit global-growth outlook

(31 August 2015, AFR, p9, by Andrew Mayeda) ‘China’s deepening struggles are starting to make a bigger dent in the global economic outlook. Moody’s Investors Service on Friday cut its 2016 growth forecast in Group of 20 economies to 2.8 per cent, down 0.3 per centage point from the company’s call less than two weeks … Continue reading

31 Aug 2015 (AFR) – WA chills as BHP Billiton, Rio Tinto and Fortescue cut $20b spending

(31 August 2015, AFR, p4, by Julie-anne Sprague ) ‘A dramatic $20 billion cut in operational spending by the nation’s three biggest iron ore miners is chilling a West Australian economy already under stress from falling investment in resources-related construction. Analysis by The Australian Financial Review reveals that since 2012, BHP Billiton, Rio Tinto and … Continue reading

31 Aug 2015 (TheAge) – Heavyweights lose patience with coal – Coal M&A predicted to rise as prices slump and growth projects prove difficult

(31 August 2015, The Age, BusinessDay, p25, Amanda Saunders) ‘Consolidation is set to sweep Australia’s struggling coal sector over the next six to 12 months, as diversified majors lose patience with depressed coal prices and companies choose M&A instead of navigating a political and environmental minefield to develop new projects.  Ernst & Young transactions partner Paul Murphy … Continue reading

31 Aug 2015 (TheAge) – 7-Eleven stores, franchisees in strife

[COMMENT: In this problem with 7-Eleven, are we also seeing a hint that the poor performance of some stores might be due to the downturn in the economy? Where else can we look for more signs of confirmation, or otherwise?] (31 August 2015, The Age, BusinessDay, p21, Adele Ferguson, Sarah Danckert, Klaus Toft) ‘The financial … Continue reading

29 Aug 2015 (AFR) – Whipsawing markets: Get used to them – Explaining this week’s manic week in stocks, and what the future holds

(29 Aug 2015, AFR, p15, by Jonathan Shapiro) ‘A terrifying collapse in global sharemarkets followed by a defiant rally bewildered and perplexed investors. But now that most of the chaos appears to have abated, is it safe to assume they’ll return to normal?  What just happened? That’s often the question financial market pundits must pretend … Continue reading

29 Aug 2015 (AFR) – Asia extends stocks rally as upbeat US GDP calms nerves

(29 August 2015, AFR, p12, by Nichola Saminather and Lisa Twaronite) ‘Asian shares extended a global rally on Friday after upbeat U.S. economic data calmed sentiment, with Chinese stocks jumping for the second day following a rocky start to the week.’ Read more at AFR.com (might need AFR login access)

29 Aug 2015 (AFR) – ASX ends rollercoaster week in the green after 4 days of gains

(29 August 2015, AFR, p41, by Stephen Cauchi) ‘It was a week that was shaping to be the worst since the dark days of the global financial crisis, but the Australian sharemarket finished in positive territory after recording four straight days of gains that more than made up for Monday’s rout. Another strong day of trading … Continue reading

29 Aug 2015 (AFR) – Jumping into falling markets – How market experts profited from stockmarket plunge

[COMMENT: Now this news story is just one of many doing the rounds currently, extolling the virtues of jumping into the market now while share prices are cheap. This is definitely headline-grabbing attention. But what is not being highlighted is the possibility that share prices for some companies might get a lot lower yet. Just … Continue reading

29 Aug 2015 (AFR) – Consumer recovery tipped: major retailers show lift

(29 August 2015, AFR, p1, by  Vesna Poljak ,  Jacob Greber ,  Carrie LaFrenz ) ‘Better than expected profit results from major listed retailers point to a nascent consumer-led recovery in corporate Australia, providing optimism in an otherwise downbeat earnings season.’ Read more at AFR.com (might need AFR login access)

26 Aug 2015 (AFR) – The big collapse in eight graphs – Mining and energy companies embrace the stackhat as commodities dive

[COMMENT: This news article includes eight commodity price charts related to the story.] (26 August 2015, AFR, p19, by Peter Ker ) ‘Miners don’t wear helmets just for safety while underground, they wear them for times like this. As if being the worst-performed sector of the year was not bad enough, mining and energy companies were … Continue reading

28 Aug 2015 (AFR) – Three lessons from profit-reporting season

(28 August 2015, AFR, p40, by Tony Boyd, Chanticleer) ‘…The latest barometer of the health of the publicly listed corporate sector shows companies struggling for decent top-line growth. This is evident in the reported revenue numbers for the year just ended, the outlook statements from chief executives and the estimates of analysts.’ <snipped…> ‘Chanticleer picked … Continue reading

28 Aug 2015 (AFR) – Venezuela is adding zeroes to its banknotes to deal with hyperinflation

(28 August 2015, AFR, p31, by Noris Soto and Nathan Crooks) ‘Venezuela is preparing to issue bank notes in higher denominations next year as rampant inflation reduces the value of a 100-bolivar bill to just 14 US cents on the black market. The new notes — of 500 and possibly 1,000 bolivars — are expected … Continue reading

28 Aug 2015 (AFR) – History points to Wall Street rebound

(28 August 2015, AFR, p29, by John Kehoe) ‘If history is a reliable guide, the United States stock market will rebound from the 10 per cent correction recorded earlier this week. Wall Street’s near-four per cent surge on Wednesday may imply the bounce back is already happening. Since 1940, there have been 10 other occasions when the S&P … Continue reading

28 Aug 2015 (AFR) – China sharemarket about turn as investors see buying opportunity

(28 August 2015, AFR, p29, by Angus Grigg ) ‘Chinese stocks snapped five days of losses amid suggestions state-backed funds were in the market buying shares, in an effort to help revive investor confidence. The Shanghai Composite Index jumped 5.3 percent to 3083.6 on Thursday, with all of the gains coming in the last 45 minutes of … Continue reading

28 Aug 2015 (AFR) – Capital strike gloomy for growth – ‘Recessionary’ investment slump blamed on Canberra, dividend culture

(28 August 2015, AFR, p1, by Jacob Greber ) ‘Business investment plunged last financial year the most since the early 1990s recession, driven by a spending freeze by corporate Australia that is likely to continue because of political uncertainty and shareholders’ obsession with dividends. In a trend likely to undermine Treasurer Joe Hockey’s hopes for a near-term economic rebound, investment … Continue reading

28 Aug 2015 (TheAge) – China tipped to weather this storm – in trouble, but this is not yet a ‘Lehman’ moment for world economy

[COMMENT: Now he opening paragraph below tells it like it is. So, we need to be careful not to be emotionally swayed by the over-dramatised headlines in the press – the headlines that sell the papers and draw us to read the articles.] (28 Aug 2015, The Age, BusinessDay, p28, Ambrose Evans-Pritchard) ‘You need steel … Continue reading

27 Aug 2015 (AFR) – Signs of risks to US shares all too clear – Signs, long unheeded, now point to risks in US economy

[COMMENT: This a really, very interesting article about the state of the US economy.] (27 August 2015, AFR, p48, by Landon Thomas, New York Times) ‘As investors scramble to make sense of the wild market swings in recent days, a number of financial experts argue that, for more than a year now, signs pointing to … Continue reading

27 Aug 2015 (AFR) – Construction falls at fastest pace in 13 years as mining work recedes

(27 August 2015, AFR, p45, by Michael Bleby ) ‘Construction work done fell last financial year at its fastest rate in more than 13 years, as resources-dominated infrastructure investment took its biggest tumble to date. The $198 billion total work done in the year to June was down 6.2 per cent on the $211 billion … Continue reading

27 Aug 2015 (AFR) – Vitamins maker Blackmores surges through $100 but no share split coming

(27 August 2015, AFR, p23, by Simon Evans) ‘The 7800 shareholders in vitamins group Blackmores are rejoicing as the stock surges through the $100 mark for the first time, and chief executive Christine Holgate says there’s no need for a share split either.’ Read more at AFR.com (might need AFR login access)

27 Aug 2015 (AFR) – Short term investors feed momentum – ‘Momentum investing’ driving China’s sharemarket to highs and lows

(27 August 2015, AFR, p22, by Rose Powell ) ‘Chinese mum and dad investors with a week-long time horizon and a taste for riding their luck are driving volatility across financial markets.’ <snipped…> ‘That would be a reasonable assumption in the case of more developed economies, where crashes are usually associated with deep recessions. But … Continue reading

27 Aug 2015 (AFR) – World trade suffers largest contraction since 2008 crisis

(27 August 2015, AFR, p21, by Shawn Donnan, Financial Times) ‘World trade recorded its largest contraction since the 2008 global financial crisis in the first half of this year, according to figures that will feed concerns over the global economy and add fuel to a debate over whether globalisation has peaked.  The volume of global … Continue reading

27 Aug 2015 (AFR) – Swiss hit by currency wars – get the bill for central bank u-turn as economy seen in recession

(27 August 2015, AFR, p12, by Catherine Bosley) ‘The Swiss National Bank may see the fallout from its dramatic policy u-turn delivered in one word this week: recession. Seven months after the central bank scrapped its currency cap, Switzerland is dealing with declining exports, stagnant manufacturing and plunging prices. Economists forecast gross domestic product shrank … Continue reading

27 Aug 2015 (AFR) – Look forwards not backwards for Asia’s next financial crisis

(27 August 2015, AFR, p10, by Greg Earl ) ‘China’s financial market turmoil has produced a wave of warnings that we are about to experience a case of history repeating itself with a round of contagion like that which produced the 1997 Asian financial crisis. But anyone worried about the future of Asia would be … Continue reading

27 Aug 2015 (TheAge,SMH) – Bears in charge as a quarter of ASX 200 down 20 per cent or more

(27 August 2015, The Age, BusinessDay, p27, Vanessa Desloires, Reporter, View more articles from Vanessa Desloires, and SMH) ‘A quarter of Australia’s top listed companies are trapped in a bear market, and the continuing global sharemarket rout is threatening to swell the number to a third. The indiscriminate selling of ASX 200 companies has pulled the benchmark index down 16 … Continue reading

26 Aug 2015 (AFR) – The $1.3m house no one wants for $420,000 – Pilbara property investors suffer as prices plunge 67pc since 2011

[COMMENT: This is a very sobering news story for the property investors who buy a property for the long term gain, and who hope to rent it in the meantime. It appears that some property values can plummet! Did someone say that property prices never fall? Well there are a few bargains like this on … Continue reading

26 Aug 2015 (AFR) – Tips for coping with ‘the uncertainty of extreme volatility’ – If you can’t take the heat get out of the kitchen

[COMMENT: The content of this news story (on cognitive biases) is highly recommended reading. But make sure to read the factual content in the context of the news article, and be careful not to accept this as financial advice.] (26 August 2015, AFR, p22, by Jeremy Chunn ) ‘When markets are struck down violently and … Continue reading

26 Aug 2015 (AFR) – Volatility appears to have come early this year – surprises seasoned ASX traders

[COMMENT: This is a very interesting story, with some insight to seasonal market moves, and the northern hemisphere summer. It does pay to be aware of these consistencies from year to year. It is somewhat related to the adage ‘Sell in May and go away’.] (26 August 2015, AFR, p18, by Philip Baker ) ‘September … Continue reading

26 Aug 2015 (AFR) – ASX defies global lead to close 2.7pc higher – ASX rallies as bargain hunters jump in

(26 August 2015, AFR, p18, by Stephen Cauchi ) ‘Investors enjoyed a spectacular bounce on the Australian sharemarket on Tuesday, with the local index initially plunging below 5000 for the first time in two years before it shook off a dismal overseas lead and further falls in China to end 2.7 per cent higher. The benchmark S&P/ASX 200 … Continue reading