Inside the market

Consumer Finance and Healthcare on, Gold off

The All Ordinaries index was up 0.5% for the week, ending 1 March 2019. The index ended the week 2.84% above its 200 DMA and is continuing to show considerable strength.

Of the 478 stocks currently comprising the index (and for which we collect data), 289 of these (60%) ended the week above their respective 100 DMAs, up from 269 (57%) names at the end of last week.  Two hundred sixty-four stocks were up for the week, while 214 ended the week flat or down. Two hundred and twenty-seven shares finished the week within 20% of their 52-week highs, with 78 of those within 5% of 52-week highs.

The standout sectors last week were Healthcare and Financials. The large capitalisation names were of particular interest in the Healthcare sector, while in Financials it was the Consumer Finance industry that caught our attention, including Flexigroup (FXL), Zip (Z1P), Money3 (MNY) and Afterpay (APT, which is technically a part of Technology sector).

Large capitalisation Healthcare names that made an impact during the week included CSL (CSL), Resmed (RMD), Ramsay Healthcare (RHC), Fisher & Paykel Healthcare (FPH) and Nanosonics (NAN).

Notable during the weak, was the general weakness of the gold producers, including some of the significant names such as Newcrest (NCM), Evolution Mining (EVN), Regis Resources (RL) and St Barbara (SBM).

This group has been in a strong uptrend since September 2018. However, the upward momentum is beginning to weaken, which is another sign that sentiment is once again reversing and that the market is once more becoming willing to increase exposure to what are perceived to be higher risk positions.

By Danny Sandler

Founder of Ocean Asset Management.