Morning Report Tuesday 23 September 2014
China coughs and the world catches a cold, led by Australia and Canada!
Yesterday, commodity prices fell to a 5-year low amid speculation that China will accept slowing growth, in other words we are simply moving away from central bank stimulation to a real market. This news smacked Australian stocks to a 4-month low and the commodity focused Canadian stocks to a 6-week low. We are currently spiralling in the eye of a storm of negativity that is feeding on itself; we have been predicting this for the last few months and are very excited by the opportunities it is / will provide.
As the $US rallies, it leads to falls in both commodities and the $A.
As the $A falls, Australian stocks are less attractive to overseas investors and they sell aggressively.
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