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Weekly Brief Sheet - 20/06/22

Provides a market round up, a selection of useful data points we use for our investment analysis, and some interesting articles/charts we have noticed recently.

In the US the S&P 500 Index recorded its worst weekly decline since March 2020 and ended the week 24% below its January peak. This was due to the Federal Reserve's most aggressive rate hike since 1994, which caused recession fears and sent stocks sharply lower for a second consecutive week. The percentage of S&P 500 members that were trading above their 50-day moving average sank below 5% during the week, the lowest level since pandemic fears battered shares more than two years ago. Consequently, this past week was rough for stocks.


Inflation and rate fears pushed the yield on the benchmark 10-year Treasury note briefly to 3.49% on Tuesday, its highest level in more than a decade.


Building permits fell 7% in May to their lowest level since last September, while housing starts sank 14.4%, the biggest drop since the onset of the pandemic.


Wednesday's retail sales data served to confirm that consumers are buying less in real terms given the higher year-over-year increase of consumer inflation (8.6%) than noninflationary adjusted figures(8%). The fear is that these prices will now become entrenched and inflation will remain persistent for longer.


Bitcoin, the world’s biggest and best-known cryptocurrency, crashed as much as 15 per cent over the weekend, hitting its weakest level in 18 months on concerns of growing troubles in the unregulated industry. It steadied at $US20,315 on Monday morning.


It was a tough week for Australian stocks too with the 200, All Ords, and Small Ords all down more than 6% for the week on similar concerns to those of US investors. The local currency shed 1.6 per cent and dropped below US69.40¢ amid a resurgent US dollar. Not helping the Australian dollar is continuing weakness in the price of iron ore, which appears set to fall below $US120 a tonne this week as steel demand in China stalls.


Links:

 

Misc. Topical Charts:

https://twitter.com/nntaleb/status/1536827765445603329
US


Sectors & Stocks:


Bonds & Fixed Income:


Commodities:

 

DISCLAIMER: This report has been prepared by H&G Investment Management Ltd (ACN 125 580 305; AFSL 317155) to provide you with general information only. In preparing this report, we did not take into account the investment objectives, financial situation or particular needs of any particular person. It is not intended to take the place of professional advice and you should not take action on specific issues in reliance on this information. Neither H&G Investment Management Ltd nor its related parties, their employees or directors, provide any warranty of accuracy or reliability in relation to such information or accepts any liability to any person who relies on it. You should obtain a copy of the Information Memorandum before making a decision about whether to invest in this product.

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