Markets Live: ASX poised to gain (smh.com.au)
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Markets Live: ASX firm as miners gain Sarah Turner email More
The ASX climbed as investors waded back into the mining sector but Boral, Cochlear and Challenger lost ground after reporting earnings. Business sentiment rebounded in January, NAB says Miners are making notable gains and banks recover RBA says wages pick up likely to be gradual Live updates Sort posts by 12:28pm
Bitcoin is heading lower - much lower - if the go-go years of the dot-com bubble are any indication.
Already slashed by more than half since hitting a record near $US20,000 in December, the cryptocurrency could plunge a further 90 per cent in an environment of unsustainably growing supply, according to Bloomberg Intelligence commodity strategist Mike McGlone.
Using Amazon. and the Nasdaq's spectacular rise and retreat at the turn of the millennium as a proxy, he said the currency could plunge to $US900.
"I spend a lot of time reading about this, and the more research I do, the more bearish I get," McGlone said in an interview. "It's very similar to these Internet companies we saw in the late nineties."
While the creators of bitcoin intended to limit supply to 21 million coins, forks mean that there are already more than 50 million outstanding coins based on the original blockchain.
There's also nothing preventing rivals from spawning an infinite amount of clones, he said. The number of tradable cryptocurrencies jumped 120 per cent in the past year.
"Parabolically increasing supply is the primary limitation to cryptocurrency market-price appreciation," McGlone said. "There's strong gravitational pull toward $US900, the average price since inception and the start of 2017." A twenty-five bitcoin. 11:43am
Deutsche Bank strategists took at look at last week's sell off in global markets and compared it to the big downward moves that took place in 1994 and 2013.
They noted that, in 1994, ten year government bond yields climbed from a low of 5.57 per cent in mid January to as high as 7.14 per cent by April after the Federal Reserve surprised markets with a 25 basis point rate hike in early February that year.
During 2013, the Federal Reserve said that it might consider cutting the pace of bond purchases, the strategists noted, and Treasury yields rose more than 60 basis points in five weeks.
The impact in equities so far in 2018 already rivals the other two comparables even though it's over a much shorter time horizon so far, the strategists said.
"It's fair to say that so far in 2018 developed market equities are already rivalling the moves in 1994 and 2013 (especially in the US) but that emerging market equities and credit (versus 2013) still have a long way to go if history is to repeat itself," they said. Deutsche Bank took a look at the recent market move. Photo: AP 11:08am
Donald Trump's hyped $US1.5 trillion infrastructure plan embraces elements of Australia's model of paying federal incentives to states to build projects, but it faces a major roadblock in the US Congress due to ballooning government debt.
President Trump, a billionaire real estate developer, unveiled his official infrastructure proposal on Tuesday Australian time. It includes limited federal funding and a promise to streamline permits and environmental approvals for projects.
"We're going to get the roads in great shape," he said, surrounded by state governors and mayors at the White House.
"We're going to have a lot of public private [partnerships] and that way it gets done on time [and] on budget."
But he appeared to tamp down expectations, saying infrastructure was not as important as the recent $US1.5 trillion tax cuts or boost to military spending.
Goldman Sachs said there was "low odds of enactment" this year.
The plan was released the same day as a broader $US4.4 trillion White House budget proposal that would add hundreds of billions more to the government's debt and gives up on an earlier goal of achieving a long-term budget surplus.
The yield on the 10-year Treasury bond hit a fresh four-year high of 2.89 per cent, after President Trump's budget director, Mick Mulvaney, warned interest rates could "spike" due to higher government spending. 10:42am
St Barbara shares climbed 5.2 per cent today in a broadly stronger mining sector.
Macquarie analysts lifted their view on the stock to outperform from neutral, saying that a site visit to Gwalia in Western Australia has made them more positive on the stock in the long term.
"Our visit highlighted to us the potential for a more sizable production expansion post the Gwalia Extension Project than we had originally forecast. This is largely due to the vent upgrade should allow a large lift in ore tonnes feeding an underutilised mill," the analysts said.
"Our revised outlook for Gwalia has led to a 16 per cent lift in our target price to $4.40 and recommendation upgrade," they added. . St Barbara CEO Bob Vassie. Photo: Wayne Taylor 10:18am
The market is holding onto gains at lunchtime, with miners...