Local market fell from the start with weak sentiment before making a slight recovery in the back end of the day. US retail data and US CPI data will set the tone for next week…BOE was playing safe while data continues to improve in EU…China is spruiking the “Silk Road” project. The best performers were Gold and Metals & Miners while Discretionary Retail, IT and Health Care were the worst performers. Consumer spending recession ahead…more tax, higher energy costs and higher cost of borrowing…retail and property outlook has substantial downside risk ahead…budget touched everything to make the claim they tried but reality is that there was no real substantial change done!!! Bank sector has more downside risk than upside…(1) stretched valuation (2) rising cost of funds (3) low credit growth (4) housing bubble (5) bank tax likely to increase over time (6) trading ex div (7) usual global hedge fund scare story time for shorts in Aussie banks (8) Aussie consumers in declining disposable income outlook (9) local monetary and fiscal policy running out of ideas (10) Canadian banks were downgraded by rating agency on housing bubble risk.


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