SHIELD – Sustainable High Yield | Recovering bond market to pull equities higher

Mathan Somasundaram

Deep Data Analytics

The expected short term profit taking in May and the bond market selloff pulled the market below the yield weighted fair value level of 5600. The disparity between the fiscal and monetary policy settings will not help growth recovery and will keep the yield thematic going for the next 12-18 months. Global growth slowdown and commodity decline will be headwinds to any green shoots of recovery. Australian equities are trading at a premium to long term multiples due to the sustainable high dividend yield on offer in a low interest rate environment. We expect the equity markets to recover as the bond yields decline with stabilising bond markets. SHIELD Top 20 picks are: large cap – CBA, ANZ, IAG and SUN; mid cap – CSR and BOQ; small cap – DSH, AFJ, CCV, IMF, UXC, MOC, KMD, CWP and GEM ; and micro cap – FRI, HFA, DDR, TGP and AVJ. (VIEW LINK)


Mathan Somasundaram
Founder & CEO
Deep Data Analytics

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...

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.