Indices: Australian ASX 200
Following yesterday’s conclusive rejection of the 7000 area, albeit under the influence of the US Fed our preferred scenario is local equities now spend a few weeks regaining their breath before attempting another foray on the upside but we shouldn’t forget that until further notice we regard this as a bear market rally and as such MM is likely to de-risk into such strength, ideally in the 7200 area but obviously all stocks will be evaluated individually.
Wednesday saw the ASX200 manage to shrug off weakness across US indices and instead focus on a healthy Asian region, it’s been a while since local stocks went looking for good news but two consecutive 0.25% rate hikes by the RBA when many expected/feared 0.5% moves appears to have been just the required tonic to awaken the bulls. Admittedly the market felt tired yesterday morning as it tested the psychological 7000 level and we shouldn’t disregard how far it has rallied in just one month:
