A correction or period of consolidation is due and this now appears to be happening. |
An upside risk for Australian shares though is that a bubble forms on the back of enthusiasm for China and resources stocks. |
Asian stocks have completely turned themselves around the past decade, and they're going higher. |
Based on the current level of bond yields and earnings fair value around 5 600 points, the dividend yield remains attractive compared to alternative investments. |
Cheap products from China and a very competitive pricing environment is helping keep underlying inflation in check. Interest rates are on hold for the time being. |
Consensus expectations are for profit growth of 13.4 per cent for the year to the December quarter. |
Developments in New Zealand are of little relevance to Australia, so won't have a lasting impact. |
Exports probably would have improved a little bit but not much, so it's really just a continuation of the past - we're not looking for a dramatic change. |
For the retail investor, a stock that costs $1 seems easier than a big-cap stock that costs $30, $40 or $80, so people are pushing into small caps. |
Global share markets appear to have entered a period of correction after most markets had a fairly strong start to the year. |
I don't think we will fall as much as Wall Street. Our market will lose 50 points or 1 per cent. |
In corporate debt, you have the credit risk of borrower defaulting … and that's why people rely on the rating agencies to provide a guide on the default risk, and the other risk is that there could be a blow out in yields, for instance, you buy a portfolio and inflation takes off or companies go bust. |
Interest rates globally are putting some pressure on financial stocks. It's quite possible we go through a bit of a correction in share markets around the world. |
It is a significant psychological milestone, the approach of which has triggered some profit-taking over the past six weeks. |
It shows you can't rely on another big jump in coal and iron ore prices to bail out the trade deficit. |