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Note from the MD: Australia passes 100th week of COVID as markets hold strong

It might feel like longer, but this week marks 100 weeks since COVID-19 arrived in Australia and turned markets upside down – at least according to a count conducted by Tyro Payments.
It might feel like longer, but this week marks 100 weeks since COVID-19 arrived in Australia and turned markets upside down – at least according to a count conducted by Tyro Payments. Technically speaking it’s less of a COVID counter, and more the company’s weekly Tyro Payments update intended to show economic activity amid the unusual situation we have found ourselves in – but as some eagle-eyed journalists this week noted, these updates have been like notches on the walls of the ASX, keeping track of time as the pandemic has played out. And, having started the week ending 20th March 2020 (when markets plummeted), it has served as a sort-of steady reminder that time – and the market – marches on. Between 20th March 2020 and 15th February 2022, the ASX 200 gained a hair under 50%. That momentum didn’t carry through in yesterday’s performance, however. The XJO opened higher this morning, quickly retracing yesterday’s losses and maintaining price action above the 7200 level. The index has effectively traded sideways over the past week, testing resistance at the 50-day and 200-day MAs on Thursday then spending the rest of the week below these levels. With implied volatility sitting at 16.92% we would expect the market to rise slightly as volatility levels drop, however with geopolitical tensions dominating headlines, and higher interest rates on the horizon, we may see lingering volatility over the coming year. There’s plenty of good news on markets too, however, with a clear majority of businesses beating expectations this reporting season.  This week also saw excitement around green energy and sustainability build on a number of fronts: In the US, actors Salma Hayek and Arnold Schwarzenegger (also the former governor of California) put their theatrical skills to use selling electric BMWs in a SuperBowl ad. Meanwhile in Australia, NAB announced (to considerably less fanfare) three new banks were joining its Project Carbon initiative to launch ‘Carbonplace’ – a sort of settlement platform for a voluntary carbon market. UBS, Standard Chartered and BNP Paribas will join NAB and fellow-existing members CIBC, Itau Unibanco and NatWest Group. Some of you might remember that Hastings Technology Metals received a sizeable loan from the Federal Government to develop its Yangibana rare earths project, while battery metal stocks saw their prices gain noticeably throughout last year. All of this remains very fresh in my mind, and the ‘green energy transition’ is certainly a space I’ve been watching with intent lately – and from these latest announcements, I’d wager I’m not alone. On the topic of moving on, we have an upcoming investor briefing with a company that provides software solutions to global blue-chip corporations, such as Apple, Microsoft and Netflix. TZ Limited (ASX: TZL) is a software company transitioning from selling perpetual software to contemporary subscription services. Following a successful turnaround and appointment of a new CEO, the company is now expecting significant growth by commercialising the vast IoT market opportunity in a post-COVID world. Tomorrow, 17th February, at 1pm (AEDT), we will be joined by TZ’s CEO Mario Vecchio for an investor briefing, which is shaping up to be a fascinating conversation for potential investors. Click here to attend.
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