Australian Stocks: What Happened Today?

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ASX Top Gainers & Losers plus Market Snapshot – 04 February 2014

Cold weather casts a dark shadow over US markets overnight with ISM manufacturing data heading decidedly lower plus the RBA decides to keep rates on hold at 2.5%, very much in line with analysts’ predictions.

What are traders talking about today? 

S&P/ASX200 lost 90.8 points or -1.75% on volume of $6 billion, closing at 5097.1.

The Dow Jones index was down 326 points or 2.08%, clearly breaking the 15,500 level and the Nasdaq index was down 106.9 points or 2.61% and breaking the 4,000 mark for the first time since mid-December.

Spot Gold was up over $20 per ounce, closing just under the $1260 per ounce mark.

Copper had its 9th consecutive losing day with support at the 3.20 level being broken for the first time since the start of December.

The Nikkei continues to lose ground with support at 14000 a critical level going forward.

Economic news

The Reserve Bank of Australia (RBA) decided to keep rates on hold at 2.5% as predicted by the majority of analysts.
January ISM manufacturing PMI came lower with a reading of 51.3, which is the lowest figure since May and shows a fall from December, which saw it hit 56.5. This subsequently sent the US markets into a tailspin with the Dow Jones falling over 300 points.
The Australian Finance Group (AFG) released the mortgage application data for January, showing a 13% decline from the previous month.

Australian sector watch

Looking over the charts

The ASX/S&P200 blew through the 5145 support line and even took out the 5095-5100 support level at the same time. It’s been a tough day in the markets with around $25 billion wiped off our major index.
The bullish divergence pattern on the cash chart is still in play as the market continues lower whilst the stochastic indicator shows a potential higher low (not shown on the chart below).
There is potentially a base around the 5100 support level and markets will have to hold this level for a chance of a rebound.
Momentum is clearly to the downside with a continued big week of economic announcements out of the US, Europe and locally here in Australia. Expect the volatility to continue.

ASX top 200 stock analysis

50% of stocks are showing oversold levels, 7% are showing overbought levels and 30% of stocks are currently above their long term moving average as of close of trading today. View the image below to better understand overbought and oversold levels.

S&P/ASX 200 Gainers and Losers

Top 5 gainers:

REA        REA GROUP +4.99%
NCM      NEWCREST MINING +4.74%
EVN       EVOLUTION MINING +4.07%
RSG        RESOLUTE MINING +1.96%
SIR          SIRIUS RESOURCES NL +1.90%

Top 5 Losers:

ACR        ACRUX -10.34%
EWC       ENERGY WORLD CORPORATION -9.72%
MGX      MOUNT GIBSON IRON -6.60%
TEN        TEN NETWORK HOLDINGS -5.41%
MND     MONADELPHOUS GROUP -5.35%