Afternoon Report / Market oscillate’ s around the 6500 region after a tough week

By Market Matters 04 October 19

Market oscillate’ s around the 6500 region after a tough week

Market Matters Afternoon Report 4th October 2019

**No weekend report out on Sunday, instead we’ll wrap it up in a Monday Morning note given the market is open despite the public holiday. I have Harry on the desk for the day, I’ll hopefully be celebrating a Canberra win in GF -  given Manly were robbed, I’d love to see the green machine get up!! Have a great long weekend all** James  

WHAT MATTERED TODAY

After a fairly brutal week across markets with the local index down around 2.5% although today we saw some consolidation around the 6500 region as we suggested was the likely outcome this morning. A low of 6490 and a high of 6532 with the index closing in the upper end the daily range, although only marginally so. While the market has pulled back this week, we’re certainly not seeing a lot of panic set in to stocks, the usual push / pull of weak economic data offset by the high chance of further central bank support dictating the state of play at the moment.  

Healthcare stocks were strong today thanks to a 3+% rally in CSL on a Morgan Stanley upgrade, the broker upgrading to buy with a $251 target , the health index up by +2.30% as a consequence while we also saw strong buying the Tech names, Appen (APX) +3.11%, Xero (XRO) +3.16% and Jumbo Interactive +6.07% the standouts. Bingo (BIN) also caught my eye adding +2.31% to $2.18, after a fairly tough week.  

To reiterate, our best guess at this stage is we will see a period of consolidation, ideally around the 6500 area, but importantly our preferred scenario is still we see a break by the ASX200 towards 6300. Stocks may have kicked off the new quarter in the worst fashion since just after the GFC but MM remains keen to buy only ~3% lower.

Overall, the ASX 200 closed higher today, up 24pts or +0.37% to 6517, Dow Futures are trading down -20pts/-0.08%.

S&P/ ASX 200 Chart

 

ASX 200 Chart


Sectors this week – All in the red bar healthcare on the week and that was driven by a CSL upgrade today.  

Stocks this week

 

BROKER MOVES;

·         ALS Downgraded to Neutral at Goldman; Price Target A$8.40

·         CSL Upgraded to Overweight at Morgan Stanley; PT A$251

·         FAR Downgraded to Equal-weight at Morgan Stanley

·         Growthpoint Rated New Hold at Moelis & Company; PT A$4.24

·         Janus Henderson Downgraded to Underperform at KBW; PT $19.50

·         NextDC Upgraded to Add at Morgans Financial; Price Target A$6.68

OUR CALLS

No changes today – we’re comfortable with our positioning given the weeks moves, although being comfortable is always an emotion that scares me!

Major Movers Today

 

Have a great night

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.

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