Market Matters Report / Market Matters Weekend Report Sunday 30th September 2018

By Market Matters 30 September 18

Market Matters Weekend Report Sunday 30th September 2018

Market Matters Weekend Report Sunday 30th September 2018

The ASX 200 had a marginally positive week with strong support coming from the energy sector while the healthcare stocks remained under pressure. On Friday night markets were marginally weaker however the S&P 500 capped off its best quarterly gain in five years, event though last week was a negative one overall. 

Our market was less impressive for the quarter finishing largely unchanged while it continues to consolidate the 4.2% decline we experienced at the start of September  The slow grind higher from the 6102 low has continued however technically, the advance has been less than convincing. SPI Futures are pricing in a drop of around 20pts on Monday morning in whats likely to be a very quiet session on the ASX due to the NSW public holiday, although we do see $13 billion of dividends hit investor accounts during the week.  

·         We continue to believe there is a strong possibility that the current pullback will test below 6000

ASX 200 Chart

We 'tweaked' the Platinum Portfolio last week adding Aristocrat Leisure (ALL) and the Emerging Markets ETF (IEM), while we expect to make some other changes next week to both the Platinum & Income Portfolios. 

I'm down in Melbourne this weekend so this is a brief update rathar than the usual Weekend Report - the team will be sending the usual Weekend note first up on Tuesday morning (instead of today) - apologies for any inconvenience caused by the slight change. There will be no usual Q & A report on Monday given the NSW puiblic holiday, however any time sensitive questions will be addressed in the Tuesday note. 

Quick Comment on the Hayne Royal Commission draft report

There has been a significant amount written over the weekend flowing from the first draft of the Hayne Royal Commission findings. This is a clearly a a major domestic event given the dominance of the financial sector in Australia.

The more significant points from the report were:

1.     The problem does not lie with existing laws so they probably won’t be changed, which is probably why the banks bounced strongly on Friday. 

2.     The problem lies partly with the determination of banks to put profit ahead of compliance with the law and there are many examples which demonstrate this

3.     There was also strong criticism around weak enforcement practices on the part of ASIC, in particular, and APRA and how these bodies worked with the companies they are regulating 

The days of a close working relationship between financial institutions and ASIC would seem to be over which leaves the door open for more court action and more penalties. The good news however for financial institutions appears to be no new laws but brace yourself for harsher penalties and more aggressive regulation.

On a brighter note, the AFL certainly delivered yesterday with a cracking game that went down to the wire - the Weagles just getting up over the Mightly Pies - lets hope the NRL can deliver another great spectical this evening - even though Manly isn't in the main dance!  

Chart Pack

The weekend report generally includes a vast number of charts covering both domestic and international markets, including stock, indices, interest rates, currencies, sectors and more. This is the engine room of our weekend analysis. We encourage subscribers to utilise this resource which is available by clicking below.

 

Holdings

Our positions as of Friday. All past activity can also be viewed on the website through this link. 

Have a great Sunday!

James & the Market Matters Team

Disclosure

Market Matters may hold stocks mentioned in this report. Subscribers can view a full list of holdings on the website by clicking here. Positions are updated each Friday, or after the session when positions are traded.

Disclaimer

All figures contained from sources believed to be accurate.  Market Matters does not make any representation of warranty as to the accuracy of the figures and disclaims any liability resulting from any inaccuracy.  Prices as at 30/09/2018

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