Aussie market started negative on market uncertainty before the shrinking bond yields pushed up the yield trade to deliver a solid positive day. Global markets went into last night with everyone wearing their “chicken little” suits screaming the “sky is falling”. The global markets were jumping on shadows. US Fed delivered as expected last night by talking down rate rise cycle and even answered questions on negative rates. If it’s good enough for ECB and BOJ, it’s good enough for US Fed. Spot gold had a big move and that sector remains a massive turnaround story since US Fed put up rates in December. NCM in particular looks to be the new QAN where management cut costs to survive at the bottom and the global macro winds are going to deliver big upside. Unless we see an Energy Lehman Brothers, we don’t see substantial downside from here….sooner or later the yield gap and recovering currency will drive our market higher!!! (VIEW LINK)
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