Brent Crude is over US$100 a barrel, the Strait of Hormuz is effectively closed, and the ASX200 was down -4% at one point intraday. This isn’t guided hypnotherapy; this is the real world, listeners. Welcome to Week 11, I’m Jonathon Davidson, and this is HotCopper’s the ASX Today for Monday. What to say about today? It’s a six-letter word that starts with f and rhymes with ucked.
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For those traders who prefer the self-importance of a more sensible market summary, well, here you go: Every other Australian sector red on Monday except for energy as absolute panic kicks in; the price of gold doesn’t want to budge higher than US$5,100 an ounce and Westpac IQ analysts mightn’t have been doomsaying last wek when they predicted Australian fuel prices could hit $3/L.
In the U.S., fuel prices are already soaring, which has Trump on damage control. The midterm elections are on the horizon, but it looks like the Republicans might be about to pass legislation that makes it harder for the poor and black and brown Americans to vote, so that could take the pressure off, and this war could go on for god knows how long.
But as they say around black swan events, there’s a three-day rule, and as I frequently remind you all, markets get tired of headlines, and eventually the big number that matters always goes back to going up and to the right.
Goldman Sachs last week said they saw markets take a fortnight to digest all of this. Clearly, last week’s decent Thursday session was a Green Herring.
That’s about the whole of it for today – so what happened in stocks land, ignoring macro?
Long-struggling Melbana Energy jumped 12% to 0.9cps, the beneficiary of higher oil prices, despite the fact Melbana is facing its own geopolitical crisis where it operates in Cuba, a country hemorrhaging citizens for the U.S. no less. Perhaps investors believe Cuba’s the USA’s next target, but I reckon people are just throwing darts.
Meanwhile, more curious price action over at former biotech darling 4D Medical – included in the All Ords today, the company dropped nearly -6% on Monday. It had been a contrarian gainer across WK10 as the war sank in; given its cap and the fact it makes no revenue, we could see the stock become a sacrificial lamb for short sellers in the weeks ahead.
Finally, BHP down -6% heading into the final hour of trade, the real killing blow for the ASX200 on Monday; that risk-off sell-off is on the back of supply disruption concerns related to war, and reports over the weekend that BHP’s hostile negotiations with Chinese ore buyers continue to deteriorate.
What a day to start off a trading week with – I’m glad I was up a mountain well above the clouds for half the weekend, or under the water playing with Octopi, because back on land, I’m not liking what I’m seeing.
Have a great night. Maybe put some gemstones in the moon and cast a peace spell. Til then, I’m Jon Davidson, you’re on HotCopper, and this has been The ASX Today.
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