Sunset Strip | Aussie Afternoon Institutional Market Wrap
Aussie market was aimless and traded around 5400 before finishing slightly higher. Why we remain negative short term (1) US Fed confirmed rate rise in June/July (2) US and Aussie market multiples are stretched (3) Volatility indices in US and Australia are at historical low levels (4) US corporate growth remains weak with rising interest rates and stronger currency (5) Aussie corporate growth remains weak with falling commodities and bank downgrade cycle (6) US markets have a history of taking profit after their recent weak reporting cycles (7) US markets have a history of taking profit after US Fed rate cycle (8) May remains the weakest season for US and Aussie markets (9) Aussie banks are trading ex div (10) Spot gold continues to fall signalling USD strengthening expected. If the US rates go up, then the market multiples will look even more stretched on relative risk. US market remains in a precarious position and they have a tendency to fall in the new month….June may start negative!!! (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...