The ASX200 had a soft day on Thursday, closing down a quarter of 1% at 7430 points. Over five days, the market is broadly flat. Inflation fears are leading markets to doubt the Reserve Bank of Australia’s (RBA) commitment to quantitative easing and a late tightening timeline compared to other central banks.

Bank of Canada abruptly ended its bond buying programme and signalled earlier interest rates rises than had broadly been anticipated by the market, which has rattled bond investors – ultra-low interest rates and extraordinary monetary measures are a key factor in the strength of global equity markets over the last decade and the withdrawal of easy money is likely to put downward pressure on Australian and international equities. At the same time, US companies have reported strong results in the latest reporting season.

The big news of the week is the start of bank reporting season, with ANZ (ANZ) beating analysts’ expectations with a 65% increase in cash earnings and a statutory profit after tax up 72%. CEO Shane Elliot expressed disappointment about mortgage growth rates as manual processing was inadequate to keep up with exceptional demand in residential property over the last twelve months, but otherwise pointed to strong results and a very healthy capital position, which may offer potential for a share buyback.

Investors were also buoyed by a substantially increased dividend. ANZ shares were up as much as 1.5% during morning trade, closing up 0.75% at $28.60. ANZ shares beat out perennial favourite Fortescue Metals Group (FMG) as the most traded stock on nabtrade, with a strong sell bias. Long term investors will note that ANZ shares are up nearly 50% over twelve months, but are flat over 5 years, and are well off their highs over the last decade. Nab (NAB), which reports its annual results on 9 November, saw its shares up half a per cent to close at $29.51; these were heavily traded with a modest trim bias, while Westpac (WBC), which reports on 1 November, was up 1% and more heavily sold. Commonwealth Bank of Australia (CBA) reported its annual results in August; it is currently trading at close to record highs and is trimmed.

In other financials, Macquarie Group (MQG) has fallen from above $200; nabtrade investors have been buying below and selling above the $200 threshold. Magellan Financial Group (MFG), co-founded by star fund manager Hamish Douglass, has struggled in 2021, as fund performance has languished and net flows have waned; its share price is down nearly 40% over twelve months, while the broader ASX200 has rallied over 22%. Nabtrade holders have been trimming their positions on modest bounces.

Resources remain the clear favourite of investors despite bank reporting season diverting their attention briefly. In recent days, resources have comprised as much as 40% of total value traded on nabtrade, with FMG and BHP (BHP) still the big winners. Buys in FMG have been as high as 92% of the number of trades placed, however, the higher value trades have been trimming, so the total value was about a 62% buy. BHP, on the other hand, has been a 90%+ buy in both number and value of trades, as investors enjoy the opportunity to buy the Big Australian at 2019 prices. Rio Tinto (RIO) has also joined the list of most traded; it has also been a strong buy.

Perennial hopeful A2Milk (A2M) returned to the headlines this week following a revision of its growth strategy, presented at its investor strategy day. CEO David Bortolussi has talked up A2M’s ‘green’ potential and a revised China strategy, including riding the return of the daigou trade. Investors were not impressed; the company’s share price fell over 10% on the update. Nabtrade investors were enthusiastic buyers, suggesting they believe the sell off was overdone. The A2M share price has fallen over 50% over twelve months, so the broader trend has not been favourable.

Internationally, the big news was Tesla (TSLA.US) becoming a trillion-dollar company following Hertz’s (HTZZ.US) announcement that it would buy 100,000 Tesla electric vehicles to boost its fleet. Tesla shares rose as high as $US1045 on the news, before closing at $1024, up 13%. Uber Technologies (UBER.US) announced the following day that it would partner with Hertz to make 50,000 Teslas available to its drivers. It’s worth noting that Tesla shares underwent a 5:1 split in late 2020, which brought its share price down to $446. Holders from that time would be up well over 100% on this week’s news; nabtrade holders were trimming, although many new buyers continue to pick up the stock, which remains number one in both international buys and holdings.