Australia’s largest bank CBA rallied an impressive +3.1% yesterday on a day when bond yields slipped lower. When we see new home loan approvals jump 10% for January it’s easy to comprehend the strong economic environment which is creating the excellent tailwind for the local Banking Sector. With term deposits still struggling to generate 0.5% pa the estimated 3.4% fully franked yield of CBA remains very attractive, especially for retail investors. We can see a move back above $90 for CBA in 2021 and potentially a challenge of $100 before Santa’s bells are ringing.
MM remain bullish CBA & the banks.
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