Sunset Strip | Aussie market started positive and then ran out of puff to finish negative after RBA kept rates unchanged
Sunset Strip | Aussie market started positive and then ran out of puff to finish negative after RBA kept rates unchanged. Turnover was just below $6.6billion. RBA's decision to leave rates unchanged is two pronged. One angle is that asset bubble being created in housing and equities while the second angle is the global macro of falling rates in China and rising rates in US will do the heavy lifting for them. We agree with RBA as it makes sense to save it's bullets for a rainy day. Once we cut our rates and drop the currency, the economy is like driving a fast car with no seat belts.We are in the middle of ex div period that continues to take money out of the market. The market will get support at the end of the month with the dividends flowing back, but in the meantime with no rate cut, very stretched multiples and negative aggregate growth from reporting season continues to drive profit taking risk. (VIEW LINK)
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