Latest / ausbiz a.m / 10.09.26 with Mark Gardner, MPC Markets
Transcript
- Andrew: Good morning and welcome to your morning wrap from Osbys. It is Thursday, September the 10th, and we are expecting a very negative start to the local session. ASX futures down around 1% in a moment. We'll preview the day ahead. With Mark Gardner, first though, quick wrap aware global markets finished overnight. Oil prices rising to a two-month high amid those ⁓ Middle East tensions. Bond yields followed suit with U.S. Treasury Secretary Scott Bessant's planned to triple the potential buyback of ⁓ Long-term debts, ⁓ in fact ⁓ buying up to six billion of outstanding securities. But the market had been hoping for much more. Now in Wall Street, the SP down around a half percent, the Nasdaq similar margin, the Dow down around 0.9% among the commodities. So Brent crude surging almost 4% to $101 US dollars a barrel. Gold is up to around $4,400 an ounce, Bitcoin trading around $78,500. And the Aussie just below seventy two point two US cents. Well, joining us to get across the market moves is Mark Garner from MPC Markets. Mark, good morning. Mark Gardner: Good morning Andrew. How you doing? Andrew: I am not bad. And that ⁓ was ⁓ well, I mean that session all about ⁓ oil and also those ⁓ where those treasury yields are going. Let's start with oil and what you're seeing in that market at the moment. Mark Gardner: ⁓ look, mean we had Goldman Sachs come out with a you know ⁓ and sort of broke from the pack saying that, you know, ⁓ a couple of days ago that they could see oil back at one hundred and twenty dollars. ⁓ I mean if you're going if you obviously you've got the issue with at the moment is that the Department of Energy Secretary, ⁓ whose name eludes me and Trump are basically saying that, you know, there's there's oil getting out. But if you look at two of the most relied upon and verified ⁓ you know, tanker trackers or ⁓ you know oil export ⁓ trackers ⁓ in you know internationally the amount of barrels per day is is down around about forty percent. ⁓ you've got ⁓ you've had diesel crack two hundred dollars a barrel as well, which is which is record highs. And ⁓ you know, ⁓ add add on to this that ⁓ you know, it we're now getting Brent now going through a hundred. ⁓ WTI's in well into the mid nineties, is there's a strong uptrend here in both, obviously. But the US reserves have been drained quite heavily. ⁓ and it's not just Trump's fault. I mean, Biden had drained them a little bit as well. ⁓ but overall they're you know, they're sitting at their lowest levels in forty odd years. So ⁓ you've got those despite the fact that, you know, Labor Day sort of marks the end of summer and the driving season in the US, ⁓ diesel's a big problem. because it it really does affect the transport sector and the agricultural and food sector in particular. ⁓ so, you know, the the knock on effects on on inflation ⁓ from diesel prices globally ⁓ will probably actually will be very close to being more important ⁓ than than the crude prices. So ⁓ they and even Trump himself last night said at the Republican convention that the war won't be over until the midterms are done. ⁓ most people are now calling next year. Andrew: ⁓ Mark Gardner: ⁓ so this is, you know, this is nowhere near over. and you know, th this has escalated a lot more than ⁓ you know, the people are giving it credit for because we're so used to the white noise coming out of the White House and and we've been living with this for seven months, ⁓ or six to seven months now. But those attacks on Carg Island or or near Karg Island on the tankers, I mean, infrastructure was always a no go. ⁓ and, you know, they're they're now go going very close to it or or ⁓ or actually sort of attacking it and the Houthis attacked some ⁓ Saudi infrastructure the previous day as well. So ⁓ yeah, not not good overall and it means that inflation will be very embedded and ⁓ and it's not going to be good for equities. Andrew: Yeah, and well certainly that's the case locally too, isn't it, Mark, as we head into the next ⁓ RBA meeting, we know ⁓ what the RBA is ⁓ thinking in regards to inflation. ⁓ you talk about equities. Look clearly ⁓ given where those oil prices are going, that's gonna benefit the energy sector. Wha what opportunity are you seeing there? How exposed are you? Mark Gardner: ⁓ energy wise, we don't necessarily have too much here in the ASX. We've got Chevron. ⁓ we're we're you know, Chevron's an open recommendation for us in the US, still looking but just because of its fortress sort of balance sheet. and ⁓ you know, they're and they are a a ⁓ very big refiner well. And the refineries are the ones making a lot of the money. ⁓ look, Santos technically looks like it's about to break up to the upside for the first time in about five years. ⁓ And looks pretty solid. ⁓ I I think overall the you know that energy sector will will uplift. ⁓ but it's really all commodities at the moment. I I think ⁓ I mean I d and I discussed this on the call yesterday, with Nadine and ⁓ Michael Cable was that, you know, it really does appear with Bessent doing these buybacks and ⁓ and the debt just spiralling that you know, most countries and and well most countries having massive debt that we they're just gonna inflate their way out of trouble in terms of ⁓ the one tactic to get rid of the debt. So commodities I think are in for a very strong run overall, which will be good for our market. I'm pretty surprised we're down one percent. We've been we've been pretty weak ⁓ overall and and I and I've got to say that our energy sector's quite a bigger chunk of our index. ⁓ and gold was obviously ⁓ gold and silver, platinum and you know, copper at record highs, ⁓ as on top of that as well. Though that commodity sector should uplift us. So I if it does open down one percent, I I would imagine it probably stabilizes and and heads a little bit higher overall. So ⁓ that US index could have been a lot worse last night. ⁓ Meta kinda saving the index a little bit. ⁓ when they announced their AI agent, which can apparently kind of go and do a few, you know, real world things. you know, for normal people, not just ⁓ you know, the the the the tech nerds, ⁓ who were who were obviously using it pretty ⁓ you know, these agents pretty fiercely. But ⁓ it was up around about six percent. And then a couple of the like Micron and SK Heinex were up ⁓ about three percent for Micron. I think ⁓ nearly eight percent now that that ⁓ that leverage trade's been flushed out in SK Heinex. ⁓ it was up yeah, it was up quite considerably. So but it apart from that and the energy sector, just red on the screen. Andrew: Mm. Yeah, ⁓ interesting. Meta, I mean that's ⁓ yeah, it's a that assistant that allows you to well, just automatically book ⁓ those ⁓ those mundane appointments for you. Interesting, comes at a time too. I don't know whether you saw that news overnight, Mark, where ⁓ a key ⁓ player in ⁓ in in behind Anthropic has ⁓ has resigned saying ⁓ that AI is now posing a significant threat to humanity. ⁓ which is a bit alarming, I've got to say. ⁓ nonetheless, look, I know you've got ⁓ ⁓ you're more exposed to the US. We also had Apple, of course. Significant change in that business. ⁓ it's unveiled its foldable iPhone. ⁓ are you on board Apple at the moment? Mark Gardner: No, I'm look, I I kind of I I'm a little bit unimpressed with Apple in terms of you know, if we're going to the US, we're going there for growth. ⁓ and Apple, you know, it's probably a nice safety play. ⁓ but they really haven't innovated ⁓ you know, significantly for quite a long time. And, you know, the even with this foldable phone, ⁓ I th you've got the likes of Motorola, Xeomi, ⁓ Huawei, ⁓ Samsung and ⁓ and Google. I mean I think Google came out with the first foldable phone. ⁓ and I may be wrong on that, but it was eight or nine, you it was eight odd years ago. So there has been really good reviews about the the the Apple Duo. I think they're you know, where the Apple is very strong is that they've ⁓ I've I've watched a couple of videos of it in action. It looks very seamless and it does fix a lot of the problems of of many of the other folderable phones or the other gripes. And you know, it it is priced very high. ⁓ I think it's something around the twenty one hundred US dollars, I think it's gonna be. But ⁓ but you know, for they do have these finance plans and things like that. I mean, it Apple o oscillated overnight and largely ended up unchanged. ⁓ you're gonna have an initial run of about 14 million units, but it they which they said that will have very you know, most of the analysts are saying they'll have very little. ⁓ trouble getting, you know, selling those ⁓ because of the Apple, you know, the Apple crowd are pretty, pretty loyal, but ⁓ at least it is something new ⁓ from them. And ⁓ after, you know, the Apple Vision, whilst apparently it's a is an an amazing product, is you know, was a was a bit of a dud as well. So ⁓ it keeps people in that ecosystem, which will just keep Apple chugging along for a while. But if we're looking for growth, Andrew: Mm. Mark Gardner: Certainly pr you know, Apple's probably one of those very mature stage companies that we're probably not really looking at at the minute. Andrew: So Mark, ⁓ locally then, so you you're exposing commodities nowhere else? What what is your positioning? Have you upped your level of cash? I mean Mark Gardner: ⁓ look at positioning wise, yeah, positioning wise at the moment. I mean, we've we've always had a bit of uranium, we've got quite a lot of copper. BHP's still ⁓ probably our ⁓ one of our largest holdings, if not our largest holding. Although we did recently trim, we ⁓ we're s ⁓ buying ⁓ some of that Greatland gold, which is, you know, at the moment the gold sector we feel feeling a little bit naked in terms of it it it shocked us how quickly it rallied back. Newmont's far too expensive at the minute, albeit probably our favorite pick. So Greatland Gold, you know, is a very good, ⁓ you know, very good new ⁓ new to the ASX. It's been on LSE for quite some time. but they're ⁓ they've got a very low all in sustaining costs. And ⁓ we really, you know, it's a bit of a wild call, but I'm very s surprised that people there's a f quite a few people agreeing with me. But I I genuinely think with the way that, you know, ⁓ the way that things are at the minute and the distrust in just central banks and fiat currency globally, I think gold can go back to record highs again, which seems like a long way away, but it's you know, it it really it really is a major push because obviously you've got the Treasury or what Besson med meddling in the curve there and and and multiple governments, not just the US with with just absolutely bloated ⁓ debt. So ⁓ you know, I think the US dollar's kind of the best of the worst. ⁓ and China's seen this from a long way off. They've they're obviously just continuing to buy ⁓ from a central bank standpoint as well for, you know, and have been for the last three years. So they're they're two areas we're focused on. We do have some of the software stocks here in Australia. We still think they're very undervalued, but they're they ⁓ usually track the software index in the states, the IGV ⁓ or ETF, sorry. And ⁓ It's lagging about thirty-five percent. So we we do expect long term that you know the likes of ⁓ Zero Wisec, ⁓ Prime Medicus, et cetera, to to to to start playing a little bit of catch up, but n probably not in this September period where seasonal weakness leading into the midterms is you know, is a is a fifty year strong trend. And ⁓ I'm I'm probably expecting there to be some sort of well, significant pullback, I think this month. ⁓ ⁓ you know, upwards of ten percent or more because ⁓ reliably every four years, since World War Two, we've had that we've had that pullback. Andrew: Indeed. Mark, ⁓ great to get across what you were seeing. I hope you ⁓ make the best of what is likely to be a negative day locally. Thanks so much for joining us from MPC Markets. And that is your Osbys morning wrap. Hope you have a great day. I'm Andrew Gagan. Thanks for listening. Mark Gardner: No worries. Thank you.