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Markets go risk off for a day, trading mayhem continues, Fortescue Metals (ASX:FMG) record production

The ASX200 (ASX:XJO) dropped at the open after a negative lead from the US, ultimately finishing down 1.9% for the day; the worst in several months.

90% of companies fell, with Unibail-Rodamco-Westfield (ASX:URW) a rare outperforming jumping 14.5%.

The growth favourites were among the hardest hit, with the IT sector falling 4.8% and the utilities sector the only sector finishing higher.

Fortescue Metals (ASX:FMG) released its quarterly update, sending the shares 4.0% lower, despite announcing record shipments of iron ore totalling 90.7 million tonnes.

Production costs remain incredibly low, just US$12.81 per tonne, with a sustained higher price likely to lead to further dividend increases.

This incredible tailwind is allowing Chairman Andrew Forrest to embark on his worldwide mission to build a green steel and hydrogen giant.

There are signs that we may be on the edge of another commodity supercycle, this time powered by clean energy and decarbonisation with a worldwide refresh of building and construction standards likely to see continued demand for iron ore.

My preference remains the more diversified BHP Group (ASX:BHP) given its exposure to battery storage.

ELMO Software (ASX:ELO) posts record, IOOF (ASX:IFL) AUM falls $400 million, gold miners fall

Payroll software solution ELMO Software (ASX:ELO) fell 2.9% after reporting record levels of cash receipts, rising 23.0% to $64.5 million. This saw annualised recurring revenue reach $74.2 million for the first half and a 42.8% increase in 2019.

The group reaffirmed guidance was provided an update on two recent acquisitions as it expands its operations in the Australian and New Zealand small business sector. This is an interesting play on the fragmented sector.

IOOF Ltd (ASX:IFL) which is in the process of acquiring MLC’s Wealth business, announced a $400 million loss in assets under management, despite market movements adding $12.7 billion during the second quarter.

The primary driver was $1.3 billion in lost accounts as the company seeks to reconstruct its financial advisory business, with another $8.1 billion previously flagged due to the cessation of external platform arrangements with BT.

Gold miners were among the worst performers for the day, despite the price of gold bullion remaining above AUD$2,400.

The sector is now being impacted by the higher AUD which is placing pressure on production costs and once again proving that the only way to use gold as a hedge is to buy bullion, not miners.

US markets rally, retail investors in the spotlight, Tesla (NASDAQ:TSLA), Apple (NASDAQ:AAPL) earnings surprise

US markets staged a strong recovery after suffering the worst fall in three months, the S&P500 and Nasdaq adding 1.0% and 0.5% respectively.

The trading tango between retail investors and hedge funds over stocks like GameStop (NYSE:GME) took another turn with platforms including the low cost Robinhood pausing trading in the stock.

In recent days, hedge funds shorting the struggling company have been on the receiving end of a collaborative and concerted effort by day trading retail investors, who communicate via bulletin boards, to push the stock higher. The regulator and politicians are now raising concerns about this weeks’ events.

Apple Inc. (NASDAQ:AAPL) produced a stunning quarterly result, reporting a 21% increase in revenue for the quarter to US$111.4 billion with the primary driver being 17% in iPhone sales.

This coincides with the latest handset launches in late 2020 with management surprised by the demand for the more expensive options.

Tesla (NASDAQ:TSLA) seemingly missed expectations despite raising their production targets from 841k to 952k vehicles in 2021; representing over 50% growth.

Finally, Facebook (NASDAQ:FB) overcame 2020 boycotts to post a 31% increase in advertising revenue over the Christmas period.