Hope is Not a Plan

So on a bottom up basis, it is hard to see the catalyst for the next leg down, given share prices are already depressed and valuations are reasonably robust.

However, there are a plethora of macro issues that are weighing on the indexes, and at this stage the recent recovery in the market is consistent with a bear market relief rally.  

We are of course not wedded to this view.   Another couple of hundred points and we may re-assess our position.   But we are about to head into the traditionally weak ‘season’ on the ASX, where 4 of the 5 middle months are commonly negative.

Whether or not the old catch cry ‘sell in may and go away’ will ring true once more is anyone’s guess.    But for us - for now - return of capital remains the focus ahead of return on capital.