Morning Report Friday 1st May 2015
After the recent savage sell-off in banks should we buy stocks?
It is important to remember virtually all Australian stock market investors heavily involved in the banks and Australian banks have now been smacked almost 10% over the last 4 weeks. The majority of the fall occurred this week e.g. Westpac 9.6%, ANZ Bank 9.2% and Commonwealth Bank 8.7%. The local market has focused very clearly on any potential bad news concerning the banks, primarily new APRA regulations that may be proposed to slow property speculation and rising bond yields / lack of confidence in more interest rate cuts.
Are we going to see bureaucratic changes affecting property investment after prices have already topped? Apartment prices actually fell in Melbourne, Brisbane and Canberra for the first quarter of 2015 as supply simply exceeds demand.
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