Sunset Strip | Aussie Afternoon Institutional Market Wrap

Aussie market opened positive and then went on with it after a slight pullback as Brexit worry started to subside. The market is beginning to move away from Brexit as the momentum to leave seems to have lost momentum after last week’s tragedy. We have seen the low in AUDUSD till RBA cuts rates in August. Currency war has started to push up AUD and RBA is almost certain to be forced to move on rates again in August as the July inflation data will remain weak. We see the banks leading the market rerating back up after the Brexit vote shows BeEU. The market is sitting on a lot of cash and the risk on trade is likely to push Aussie market to new 12mth high in July. We are likely to see substantial yield trade with strong currency after the vote on Friday. In the meantime we have RBA updates tomorrow and US Fed Chair update on Thursday morning. (VIEW LINK)