The US stock markets have given Australian investors a closing down for Christmas lead. Trading volumes were light in the US and recent market direction has been flat.
However, local markets have not so far taken this lead. It’s been a busy week on the ASX with substantial turnover, especially for this time of year. Unlike the US market, the ASX 200 has had a clear direction and was up 1.4% for the week by yesterday’s close.
Support for the utilities and real estate sectors has been a consistent theme so far this week but yesterday investors returned to mining stocks in the search for relative value.
Early trading may provide some insight into whether, Australian investors will stay busy and positive or follow the US lead and drift into the Christmas break
Yesterday’s update was a relief for A2Milk shareholders. The statement provided welcome comfort that A2’s sales have not been swept up in the issues impacting Bellamy’s. Despite yesterday’s rally, A2Milk’s share price remains well below where it was when Bellamy’s went into a trading halt. It seems likely to maintain at least some discount to reflect the uncertainty surrounding the whole infant milk sector. There remains a risk of price discounting and other issues while changes to the sales channel in China are being worked through.