Tue 17 Jan 2017

The World Economic Forum commences in Davos-Klosters, CH

Klaus Schwab’s 2017 World Economic Forum commences in Davos-Klosters, CH More

In Portfolioticker today

Today at the stock market NBR

bull/bearPolitics dominated global markets as the dollar weakened after the president-elect called the U.S. currency “too strong” and the GBP rallied on British Prime Minister Theresa May’s plans to leave the European Union. The S&P 500 Index slid 0.3%, led by financial and industrial companies.

“The dollar is the guiding light at this point, and all eyes are on the shape U.S. policy will take. I would put today’s dollar weakness down to noise rather than a structural shift. If Trump wants to become as growth-generative as he’s planning to be and you don’t have the same fiscal push coming from the rest of the world, then it’s a question of where does the capital flow to. The dollar is the tallest pygmy. The dollar is the guiding light at this point, and all eyes are on the shape U.S. policy will take,” said Fredrik Nerbrand, global head of asset allocation at HSBC Holdings Plc in London.

There’s no end in sight to the impact of Brexit and Trump, twin themes which have dominated markets this year and last. Traders are puzzling over the meaning of the president-elect’s comment ahead of his inauguration Friday, while May’s confirmation that parliament will get a vote on the final Brexit deal added to the GBP’s momentum against the USD.Bloomberg

Market indices

The shape of market indices today
^ Market indices today Chart: Yahoo Finance

Index Ticker Today Change 31 Dec 16 YTD
S&P 500 SPX (INX) 2,265.56 -0.40% 2,238.83 +1.19%
DJIA INDU 19,792.96 -0.47% 19,762.60 +0.15%
NASDAQ IXIC 5,534.35 -0.72% 5,383.12 +2.8%

The portfolio today

:-) Our USD-denominated index rose above 2.2 for the first time today, but closed at 2.1998 which was a new record.
:-( Donald Trump’s comment that the USD is too high was expensive for our AUD-denominated index.

Index values

Index Currency Today Change 31 Dec 16 YTD
USD-denominated Index USD 2.199 +0.30% 2.105 +4.50%
Valuation Rate USD/AUD 0.76122 +1.16% 0.72663 +4.76%
AUD-denominated Index AUD 2.890 -0.83% 2.895 -0.17%

Stock price movements

The shape of the portfolio today
^ The shape of the portfolio today Chart: Yahoo Finance

Portfolio stock prices

Stock Ticker Today Change 31 Dec 16 YTD
Alphabet A GOOGL $827.46 -0.42% $792.45 +4.41%
Alphabet C GOOG $804.61 -0.40% $771.82 +4.24%
Apple AAPL $119.97 +0.79% $115.82 +3.58%
Amazon AMZN $809.72 -0.91% $749.87 +7.98%
Ebay EBAY $30.29 +0.00% $29.69 +2.02%
Facebook FB $127.87 -0.37% $115.05 +11.14%
PayPal PYPL $41.27 -0.79% $39.47 +4.56%
Twitter TWTR $16.96 -1.62% $16.30 +4.04%
Visa V $81.26 +0.10% $78.02 +4.15%
VMware VMW $81.49 -0.62% $78.73 +3.50%

52-week performance

USD and AUD denominated indices over the past 52 weeks (Chart: Bunting)
^ USD and AUD denominated indices over the past 52 weeks (mouseover for max view) Chart: Bunting

FX: USD/AUD

USD

DXY movements
^ Bloomberg Dollar Spot Index (DXY) movements today (mouseover for 12 month view) Chart: Bloomberg

The USD fell against most major currencies after Donald Trump told the Wall Street Journal its value is too high in part because China holds down its currency. WSJ

The Bloomberg Dollar Spot Index (DXY) retreated 1.3% as of 4 p.m. in New York to the lowest in a month and Britain’s GBP surged 2.9% to USD1.2403.

Japan’s JPY traded at 112.68 per USDr, up 1.4%. The JPY has strengthened 3.7% over 7 sessions.Bloomberg

AUD

AUD movements
^ AUD movements against the USD today (mouseover for 12 month view) Chart: xe.com

Oil and Gas Futures

Futures prices

Prices are as at 15:48 ET

  • NYMEX West Texas Intermediate (WTI): $52.48/barrel +0.21% Chart
  • ICE (London) Brent North Sea Crude: $55.45/barrel -0.73% Chart
  • NYMEX Natural gas futures: $3.40/MMBTU -0.70% Chart

flag_australia Australia: Housing Finance. Nov 2016

apartments_20170117

Press Release Extract [ser_44]

DWELLINGS FINANCED

Value of Dwellings Financed

The total value of dwelling commitments excluding alterations and additions (trend) rose 0.6% in November 2016 compared with October 2016, while the seasonally adjusted series rose 2.2% in November 2016.

The total value of owner occupied housing commitments (trend) was flat in November 2016. Rises were recorded in commitments for the purchase of new dwellings (up $9m, 0.9%), and commitments for the construction of dwellings (up $7m, 0.4%), while a fall was recorded in commitments for the purchase of established dwellings (down $26m, 0.2%). The seasonally adjusted series for the total value of owner occupied housing commitments rose 0.4% in November 2016.

The total value of investment housing commitments (trend) rose (up $210m, 1.7%) in November 2016 compared with October 2016. Rises were recorded in commitments for the purchase of dwellings by individuals for rent or resale (up $203m, 1.9%) and commitments for the purchase of dwellings by others for rent or resale (up $4m, 0.4%) and commitments for the construction of dwellings for rent or resale (up $3m, 0.3%). The seasonally adjusted series for the total value of investment housing commitments rose 4.9% in November 2016.

Number of Owner Occupied Dwellings Financed

The number of owner occupied housing commitments (trend) fell 0.1% in November 2016, following a fall of 0.4% in October 2016. A fall was recorded in commitments for the refinancing of established dwellings (down 162, 0.8%), while rises were recorded in commitments for the purchase of new dwellings (up 20, 0.7%) and commitments for the construction of dwellings (up 11, 0.2%). The seasonally adjusted series for the total number of owner occupied housing commitments rose 0.9% in November 2016.

Number of Owner Occupied Dwellings Financed – State

Between October 2016 and November 2016, the number of owner occupied housing commitments (trend) fell in New South Wales (down 67, 0.4%), Western Australia (down 41, 0.7%), South Australia (down 25, 0.7%), the Australian Capital Territory (down 8, 0.8%) and the Northern Territory (down 5, 1.6%), while rises were recorded in Victoria (up 14, 0.1%), Queensland (up 10, 0.1%) and Tasmania (up 8, 0.8%).

The seasonally adjusted estimates rose in Queensland (up 258, 2.4%), New South Wales (up 245, 1.5%), Victoria (up 124, 0.8%), the Northern Territory (up 8, 2.7%) and the Australian Capital Territory (up 2, 0.2%), while falls were recorded in Tasmania (down 10, 1.0%), Western Australia (down 41, 0.7%) and South Australia (down 52, 1.3%).

PURPOSE OF FINANCE (OWNER OCCUPATION)

Construction of dwellings

The number of finance commitments for the construction of dwellings for owner occupation (trend) rose 0.2% in November 2016, after being flat in October 2016. The seasonally adjusted series rose 2.3% in November 2016, after a fall of 0.3% in October 2016.

Purchase of new dwellings

The number of finance commitments for the purchase of new dwellings for owner occupation (trend) rose 0.7% in November 2016, following a rise of 0.6% in October 2016. The seasonally adjusted series rose 3.3% in November 2016, following a rise of 0.8% in October 2016.

Purchase of established dwellings (including refinancing across lending institutions)

The number of finance commitments for the purchase of established dwellings for owner occupation (trend) fell 0.2% in November 2016, following a fall of 0.5% in October 2016. The seasonally adjusted series rose 0.6% in November 2016, after a fall of 0.7% in October 2016.

Refinancing

The number of refinancing commitments for owner occupied housing (trend) fell 0.8% in November 2016, following a fall of 1.1% in October 2016. The seasonally adjusted series fell 1.3% in November 2016, following a fall of 3.7% in October 2016.

TYPE OF LENDER (OWNER OCCUPATION)

Banks

The number of commitments for owner occupied dwellings financed by banks (trend) fell 0.1% in November 2016, following a fall of 0.3% in October 2016. The seasonally adjusted series rose 1.1% in November 2016, after a fall of 0.3% in October 2016.

Non-banks

The number of commitments for owner occupied dwellings financed by non-banks (trend) fell 1.1% in November 2016, following a fall of 1.2% in October 2016. The seasonally adjusted series fell 1.5% in November 2016, following a fall of 4.3% in October 2016. The number of commitments for owner occupied dwellings financed by permanent building societies (trend) fell 7.1% in November 2016, following a fall of 7.0% in October 2016.

HOUSING LOAN OUTSTANDINGS

At the end of November 2016, the value of outstanding housing loans financed by Authorised Deposit-taking Institutions (ADIs) was $1,550b, up $10b(0.6%) from the October 2016 closing balance. Owner occupied housing loan outstandings financed by ADIs rose $7b (0.7%) to $1,006b and investment housing loan outstandings financed by ADIs rose $3b (0.6%) to $544b.

Bank housing loan outstandings rose $10b(0.7%) during November 2016 to reach a closing balance of $1,513b. Owner occupied housing loan outstandings of banks rose $7b (0.7%) to $977b and investment housing loan outstandings of banks rose $3b (0.6%) to $536b.

Australian Bureau of Statistics, “5609.0 – Housing Finance, Australia, November 2016“, 17 Jan 2017 More

flag_uk Theresa May’s Brexit Speech

Theresa May sets out her 12 Brexit negotiation priorities

Theresa May sets out her Plan for Britain, and her 12 Brexit negotiation priorities

UK Prime Minister Theresa May today delivered a speech at Lancaster House, London on “the Plan for Britain, including the 12 priorities that the UK government will use to negotiate Brexit.” Full Text

So today I want to outline our objectives for the negotiation ahead. Twelve objectives that amount to one big goal: a new, positive and constructive partnership between Britain and the European Union.

And as we negotiate that partnership, we will be driven by some simple principles: we will provide as much certainty and clarity as we can at every stage. And we will take this opportunity to make Britain stronger, to make Britain fairer, and to build a more Global Britain too.

Those 12 objectives are:

  1. Certainty. Key comment: “I can confirm today that the Government will put the final deal that is agreed between the UK and the EU to a vote in both Houses of Parliament, before it comes into force.”
  2. Control of UK’s own laws. Key comment: “We will take back control of our laws and bring an end to the jurisdiction of the European Court of Justice in Britain. Leaving the European Union will mean that our laws will be made in Westminster, Edinburgh, Cardiff and Belfast. And those laws will be interpreted by judges not in Luxembourg but in courts across this country. Because we will not have truly left the European Union if we are not in control of our own laws.”
  3. Strengthen the Union between the 4 nations of the United Kingdom. Key comment: “As we leave the European Union – no new barriers to living and doing business within our own Union (should be) created. I should equally be clear that no decisions currently taken by the devolved administrations will be removed from them.”
  4. Maintain the Common Travel Area with Ireland. Key comment: “We will work to deliver a practical solution that allows the maintenance of the Common Travel Area with the Republic of Ireland, while protecting the integrity of the United Kingdom’s immigration system.”
  5. Control of immigration. Key comment: “Brexit must mean control of the number of people who come to Britain from Europe.”
  6. Maintenance of rights for EU nationals in Britain, and British nationals in the EU. Key comment: “We want to guarantee the rights of EU citizens who are already living in Britain, and the rights of British nationals in other member states, as early as we can.”
  7. Protect UK workers’ rights. Key comment: “As we translate the body of European law into our domestic regulations, we will ensure that workers rights are fully protected and maintained.”
  8. Free trade with European markets. Key comments:
    • “A vote to leave the EU would be a vote to leave the single market. We do not seek membership of the single market. Instead we seek the greatest possible access to it through a new, comprehensive, bold and ambitious free trade agreement.”
    • “The days of Britain making vast contributions to the European Union every year will end.”
  9. New trade agreements with other countries (beyond the European Union). Key comment: “I do not want Britain to be part of the Common Commercial Policy and I do not want us to be bound by the Common External Tariff. These are the elements of the Customs Union that prevent us from striking our own comprehensive trade agreements with other countries. But I do want us to have a customs agreement with the EU.”
  10. UK as the best place for science and innovation. Key comment: “We will welcome agreement to continue to collaborate with our European partners on major science, research, and technology initiatives.”
  11. Co-operation in the fight against crime and terrorism. Key comment: “I want our future relationship with the European Union to include practical arrangements on matters of law enforcement and the sharing of intelligence material with our EU allies.”
  12. A smooth, orderly Brexit. Key comment: “I want us to have reached an agreement about our future partnership by the time the 2-year Article 50 process has concluded. From that point onwards, we believe a phased process of implementation, in which both Britain and the EU institutions and member states prepare for the new arrangements that will exist between us will be in our mutual self-interest. This will give businesses enough time to plan and prepare for those new arrangements.”
Press Comment: Reuters [ser_139]

Britain will leave the EU’s single market when it exits the European Union, Prime Minister Theresa May said on Tuesday, putting an end to speculation that London might try to seek a “soft Brexit”.

In a long-awaited speech in which she sought to define the country’s future as a global player that aims to trade freely far beyond Europe, May said the final exit deal would be put to parliament for a vote.

That promise helped revive the GBP on currency markets. The GBP, which has traded at the lowest levels against the USD for more than three decades, rose during May’s speech hitting a day high.

May said she would seek an equal partnership with the EU but that she would not adopt models already used by other countries that have free trade agreements with the bloc.

Her statement that Britain would leave the single market was by far the clearest indication she has ever given of her plans for the future, after months of criticism that she was not being sufficiently transparent.

“I want to be clear: What I am proposing cannot mean membership of the single market. Instead we seek the greatest possible access to it though a new comprehensive, bold and ambitious free trade agreement. That agreement may take in elements of current single market arrangements in certain areas,” May told an audience of foreign diplomats and Britain’s own Brexit negotiating team at a mansion house in London.

Her announcement that she will put the final Brexit deal to a vote in both houses of parliament comes ahead of a court decision on whether she has the power to start the process of withdrawing without parliamentary approval.

She has said she plans to launch the 2-year exit negotiation process by the end of Mar 2017.Reuters

flag_japan Japan update

Currency: USD/JPY

JPY movements
^ JPY movements against the USD over the past month (mouseover for inverse) Chart: xe.com

Stockmarket: Nikkei 225

N225 movements
^ Nikkei N225 movements over the past week Chart: Yahoo Finance

flag_china China update

Currency: USD/CNY

CNY movements
^ CNY movements against the USD over the past month (mouseover for inverse) Chart: xe.com

Stockmarket: CSI300

CSI300 movements
^ Shanghai CSI300 movements over the past week Chart: Yahoo Finance