Macro outlook: Markets have rebounded from the lows on better commodity prices, China data and US reporting season. Markets are heading into May selling season with risk of slowing China and weaker commodity prices, while the US Fed update is likely add to the volatility. Local budget update and election cycle will drive down consumer sentiment, while banks are likely to push up cost of borrowing as bad debt cycle and regulatory requirements rise. Short term uncertainties are expected to clear the path for an optimistic medium to long term outlook. Current quant strategy model portfolio: Transport – large (SYD, TCL); Consumer Services – small (AAD, AGI, IPH, MTR); Media – mid (FXJ), small (APN, VRL), micro (EVT, ICQ); Staples – large (WES, WOW); Health Care – large (CSL, RHC), mid (RMD); Banks – large (NAB); Diversified Financials – large (MQG), mid (HGG), small (IMF); Insurance – large (SUN), micro (AUB); Property – large (LLC); Information Technology – small (GBT, IFM), micro ( HUB); Telecommunications – large (TLS), micro (SDA); Utilities – large (APA), mid (SKI). (VIEW LINK)
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