Yovich & Co. Market Update - 22 February 2016
Feb 22, 2016 | Commentary
- Markets have continued their shaky start to the year but the reporting season has started and some positive sentiment has started to turn the downward trend.
- Last week the NZX rose 3.6% and was helped by a couple of takeover offers for Nuplex and Diligent.
- The reporting season has started positively with announcements from Auckland Airport (AIA), Chorus (CNU) and TradeMe (TME) all exceeding expectations.
- The weakness in commodity and energy prices has continued to weigh on the Aussie market although last week the All Ords had its best week since November last year.
- Over the past month the Kiwi Currency has strengthened against both the Aussie and the Greenback with the carry trade once again looking attractive as traders speculate on interest rises to stay at the current low levels in the US.
Macro Theme in Current Economic Environment
The rocky start to the year has not been a surprise to us as the signs were around last year that there would be more uncertainty around energy / commodity prices and how the world would react to the slowing growth in China. Given these uncertainties and a low interest rate environment our focus remains on identifying opportunities in defensive sector, high yielding investments. In addition to this, the NZD AUD exchange rate remains at historically high levels so it is also attractive to invest across the Tasman. Below is a list of our preferred high yielding Australian stocks:
Ratings Guide: U = Underperform, N = Neutral, O = Outperform. Ratings are relative performance compared to the underlying market over the next 12 months.
Weekly Update Investment Shares Bonds Market Commentary High Yield Investments