The 10 year UST yield fell to 2.45% on Friday. Yet the S&P 500 rose to a record high. Usually when both stocks and bonds rise, one must be right.
I've been de-risking for the last month. I still like cyclicals like mining for copper, and energy, but not iron ore. I like agriculture at this point too as we may face the worst El Niño in decades.
US and European banks are still extremely cheap.
I've been taking profit from much of the bonds / perps.
AUDUSD has reached neutral territory. I don't think RBA will cut rates further. But I don't think they will hike either.
I've been de-risking for the last month. I still like cyclicals like mining for copper, and energy, but not iron ore. I like agriculture at this point too as we may face the worst El Niño in decades.
US and European banks are still extremely cheap.
I've been taking profit from much of the bonds / perps.
AUDUSD has reached neutral territory. I don't think RBA will cut rates further. But I don't think they will hike either.
Shock and ore
Oreful chart...
Iron ore price has gone into something approaching freefall, plummeting all the way down to US$91.50/tonne overnight.
That's the lowest level we have seen since since the first week of September 2012, but that time the price recovered fairly quickly.
Surprisingly the Aussie dollar is still buying 93 US cents, but you'd have to think there are significant downside risks to that with the iron ore price having been clobbered by more than a third (34%) since the beginning of the year (click chart):
Not expecting a great week ahead for mining stocks, while there will be a couple of iron ore mining companies getting a bit twitchy up in the Pilbara as the commodity spot price continues to decline towards their breakeven point.
Interest rate hikes are looking a million miles away now.
No comments:
Post a Comment