The Australian resources sector thrives on a strong start from the S&P500
The Australian resources sector thrives on a strong start from the S&P500. The S&P500 has fallen 24 times in January in the 63 years since 1950 and returned a positive outcome in the balance of the year on 13 of these occasions. The principal Australian resources sector price indicator has been lower in January 27 times. Of these, the index moved higher in the balance of the year on 17 occasions with an average gain of 28.2%. In the minority of cases, when there was a negative result in January and the market fell further in the balance of the year, the average fall was 20%. A poor start does not preclude a positive performance later. If, however, the US market has a positive first month, the resources stocks have risen in the remainder of the year 76% of the time.
John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...
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