Sunset Strip | Aussie market was bashed from the open with China growth worries, falling commodity prices and US rate rise risk. Turnover was just below $4.8billion. Market has been running on yield chase after RBA delivered the surprise rate cut in Feb. The China downgrade, falling commodities and US rate rise hope will deliver a lower currency in the next 2-3mths. Now the market is beginning to think about not getting a rate cut for a few months or may be till September? Will the current market multiples be supported if that happens? As we have been saying since the end of Feb that the yield differential and valuation multiples suggest that we will see profit taking. Any rise in rates in US will drive rates up in emerging markets and that will drive down demand for commodities. Given our exposure to commodities, time to buckle up, this may get messy short term!!! (VIEW LINK)