Sunset Strip | Aussie market started positive and then rolled over to a slight negative day on solid volume

Sunset Strip | Aussie market started positive and then rolled over to a slight negative day on solid volume. Market has moved from fear to extreme greed in the chase for yield with global players taking part (i.e. turnover once gain reaching near the magical $7b). History shows over the past 2 years that strong positive Feb returns leads to negative March returns. The market is being driven by short covering and yield chase. As we have said before, QE and low interest rates always drive quick burst of PE expansion on greed before the market over heats and comes back to reality. The short covering is quick while the yield chase is likely to be the key driver of the market for the next few years. As we have been expecting US Fed minutes points to low rates remaining longer. Now more and more economists are calling for another cut in March. But we remain of the view that another cut in March will be another wasted cut. (VIEW LINK)