Sunset Strip | Aussie Afternoon Institutional Market Wrap
Aussie market started positive and traded aimlessly till the Chinese devaluation of Yuan hammered AUDUSD and the market down. The market was caught completely unaware by the PBOC move to devaluate Yuan, but regular readers would know that we have been talking about this move for the past few weeks. Just like in Australia the monetary policies are losing effect, but China has the ability to change their rate against USD when they like and they did. China has once again taken another step in the next phase of “Currency Wars” and they will have to make many more before the current cycle is over. We maintain our short term view that bank risk and China stimulus will help Resources outperform Banks. The recent pullback has started to get us back to value territory with more upside risk than downside risk, but the reporting season volatility means that we are likely to tread water till we get past the banking stock updates…stuck between Value territory of 5500 and recent highs of 5700…stay nimble!!! (VIEW LINK)
Over 25 years’ experience in the finance/tech industry. Mathan has worked extensively in all parts of the finance sector (i.e. County NatWest, Citi, LIM, Southern Cross, Bell Potter, Baillieu Holst and Blue Ocean Equities). Currently Founder and...