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Bi Monthly Market Update | Equity markets up 5.5% in the last two days…the Bulls are chasing the Bears!

By Jody Fewster

Equity markets up 5.5% in the last two days…the Bulls are chasing the Bears!

  • Synchronised monetary tightening resulting in a stronger greenback (plus energy and food shocks) have investors rattled and the UN warning the Fed not to go too far. The US is already showing signs that growth is slowing with job openings falling sharply in August signalling the fight against inflation is working.
  • The UK Government has dumped their “borrow big to give tax cuts” policy, which has given some comfort to markets.
  • OPEC are meeting in Vienna today and are expected to announce a large cut in oil production. Brent Crude is down 25% over the past few months amid concerns of weaker demand as Central banks tighten monetary policy. A million-barrel/day cut would tighten the market considerably.
  • A rally on Wall Street and lower than expected interest rate rise yesterday sent the Australian stock market soaring to its best day in more than two years. The S&P-ASX 200 closed up a whopping 3.8% on the news, the biggest rise in 2 years. It’s up another 1.74% as I type. The dollar initially dropped 1% on the news but regained to end at $US 64.75c
  • The Cash rate is now at 2.6% which was predicted by only 28% of economists. Slowing the rate of increases to assess the impact of its fastest tightening regime since 1994 seems imminently sensible to many.
  • RBA expects annual inflation to peak at 7.75% this year. It’s expected to fall to just over 4% next year and around 3% in 2024 (the upper band of its target 2%-3% range).
  • China’s property market remains under a cloud due to too much supply, too few buyers and too much debt. Watch this space.
  • Luckily here in the western suburbs, we have too little supply and too many buyers.
  • Call me today to see how all these factors affect the value of your home.
  • Why wait? Call me today for a strategy and professional approach to maximise your sale price.
Authored by Jody Fewster
Please call 0414 688 988 if I can provide you with a current market appraisal and detailed marketing plan for your home or investment property.
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