Aussie market started negative before having a decent relief rally. Brexit has shaken things up in the market and it will remain negative short term for UK and Euro. UK will now move into leadership transition in the ruling party and the main opposition. The leadership change will take a few months while EU wants to move on the divorce proceedings ASAP. EU will inevitably have to defend the union by making any deal less positive for UK to limit the contagion effect. We continue to see markets chasing yield as bond yields fall back to historical low levels and growth starts to grind lower. Australia still looks attractive for investors on growth to risk outlook as RBA still holding relatively high cash rate. Global markets have moved into pullback mode with US and Euro indices leading the way….stand a side, watch and pick off quality small caps and good discounted yield plays when the market throws the baby out with the bath water!!! Never miss a good crisis!!! (VIEW LINK)
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