Chart of the Day: ASX50 = ASX8

[ReturnToZero]

http://www.macrobusiness.com.au/2011/09/chart-of-the-day-asx50-asx8/

So the big 8 "Houses and Holes" companies contributed 99% of all profit growth and made up 75% of all profits for the top 50 companies in Australia. The only other profit growth came from energy companies who also require high commodity prices.

And because of ructions in overseas markets, namely a possible slowdown in China and financial/credit crises in Europe, risk institutions have pushed down the only profitable sectors of the ASX50 (and hence the ASX200 as they dwarf all the smaller companies by capitalization size).

Going by the chart below, it makes more sense to follow the ASX50 instead of the ASX200, and therefore, just follow the "top" (sic) 8 companies, the "ASX8.

The slow bursting of the housing bubble that is happening now and the euro crisis is going to take down the banks and with China slowing, it's going to take down our miners. Our economy is so fragile it's getting ridiculous.

 

[jparrie]

Wow, talk about eggs in a basket.