A return to a proper bull market? Or will we be let down by half yearly reporting/confession session that kicks off in February? The market seems to be ignoring any bad news at the moment, the dogs are having their day.
My super was up a bit and my bank shares did well, but I had a speccy stock that was sold off a little which brought my overall result back to earth.
I'm predicting some very sobering news. Rio Tinto have already announced multi billion dollar impairments on their Alcan aluminium asset. CEO blows up $35billion in 5 years and walks away with $35million in his pocket. BHP won't be as bad, but there will be impairments here and there.
Credit growth is non-existant, the banks are having a hard time generating any loans. December was apparently the worst month ever for first-home owner loans. Expect to see more of the same from the bank execs. "Tough environment", "funding costs are rising", guarantee you that will be the gist of their speeches. Having said that, loan impairments are not getting out of hand, people are still paying their mortgages.
The entire Aussie market has been repriced from 10x forward P/E to 13x in a couple of months. It's back thereabouts to long term averages but we don't have the growth to sustain it. Can see it dropping back a little before picking up in the second half. Hurts me to say it but a new Liberal government will be a positive for business and consumer confidence from September onwards.