Aussie market opened negative and kept on falling with global investor selling before recovering some of the losses in the back end of the day. The move by China to allow Yuan to devaluate with the falling growth outlook is how the free market was expected to work. But in a world where Currency War has been key growth policy in US, Japan and Euro, the move by China to readjust the balance means that US, Japan and Euro will see growth risks rise. The US markets are showing signs of potential “Death Cross” rollover in the US reporting season. Any rise in US growth risk will drive capital out of US and weaken the USD. History shows that weaker USD means stronger commodities. In this scenario, Aussie market is likely to experience a spike in resource stocks and currency. We are waiting to see the domestic unemployment data on Thursday, while the US reporting season starts tonight. There is no need to rush. Time to wait for the data and then react!!! Notable moves today were… (VIEW LINK)
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