The XJO managed to pull through August relatively well, after a month of heavy volatility left it only slightly lower than where it started. There wasn’t much movement in the index after the RBA kept the cash rate unchanged at 4.1% as was widely expected, but news out of China revealed the country’s aggressive stimulus measure to prop up their property market and we saw Chinese stocks rally.

Tactics such as reducing the required down payments for home buyers and encouraging lenders to cut rates on existing mortgages are expected to the spur the industry on and create enough activity to give their major builders a real and perceived sense of stability. It will also go a long way towards driving further confidence in iron ore and copper markets, which derive most of their demand from China’s property sector.

The Hang Seng Mainland Properties index advanced 8.2 per cent, with developers such as China Resources Land and Longfor Group up 10 per cent and 8.4 per cent, respectively.

Gold refuses to go anywhere near US$1,900/oz, and has been comfortably trading around US$1,930/oz for quite some time now. The true driver of the gold price, being real interest rates, could well be gearing up for a prolonged period of conditions that may be favourable for the precious metal, and M&A is starting to flood the market.

Key Q2 GDP growth figures are out of the U.S. today at 11:30 AEST, with the revised second estimate of an annualised growth of 2.1%. These numbers could affect the conversation around the U.S. Fed’s stance on interest rates. ⁴⁵

Overnight, major U.S. markets fell across the board after being shut on Monday for Labor Day holiday.

This U.S. market weakness was led by The Dow Jones Industrial Average, which lost 0.56% to finish at 34,641. The S&P 500 dropped 0.42% to close at 4,496 while The Nasdaq Composite edged slightly lower to settle at 14,020. ⁶

Oil prices rose after Saudi Arabia and Russia extended voluntary supply cuts. West Texas Intermediate futures rose by over 1% and briefly traded above $87 per barrel, reaching their highest levels since November 2022. ⁶

While U.S. markets were lower on Tuesday, the major indexes broke above their respective 50-day moving averages last week in a positive sign for global equities markets. ⁶

The XJO has mostly recovered from its dip towards the end of August, and is comfortably trading above 7250. It is still well above both its 52 week low of 6411, and its 13 week low of 6998.

The XJO was largely flat throughout the past week, with the index only slightly off by 0.8% from yesterday’s continued rate hole. It was sitting around 7255 just before 2pm today – a smidgen higher than its 200 day weighted moving average of 7243 and just a tiny bit lower than its 50 day weighted moving average of 7263. The index’s 52 week high currently stands just over 7567.

Tomorrow, Thursday, 7th September at 12pm (AEST), we will be joined by Anthony Reilly, Managing Director and CEO of Felix Gold Ltd (ASX: FXG) – a gold exploration company situated right next to Kinross Gold Corporation’s Tier 1 Fort Knox mine, which is operating under capacity. 

The highly prosperous region of Alaska has hosted gold production in excess of 16moz, and Felix has spent the last 18 months drilling out their flagship NW Array project, which could host 1.1- 3.6Moz gold. The maiden JORC resource for the Southern Zone is due imminently, and is expected to contain between 270k-890koz gold – which Felix believes is enough to get Kinross to the negotiating table. Click here to book your spot or request the replay.

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