SC’s weekly roundup and recommendations below. An excellent report as usual without any major changes to their stance from last week.
They sight “many clouds on the horizon” and a short term risk of a correction in asset markets. They would use the opportunity of a decent correction to buy more of their preferred assets namely high yield corporate debt and defensive equity issues with the theme remaining on value whilst managing volatility, protecting against inflation and getting paid to wait. I whole heatedly agree with their conclusions for the moment and this has been the theme of the last 12 months in fact since last April when the commodity train took a breather from its bull run. This week they sight IT and energy as their two preferred sectors due to current valuations. (This needs a closer look!)
The macro over view continues to be pretty dire with few bright spots other than onward escalation central bank monetizations of debt.
FX wise they continue to like the AUD and recommend using this near term US$ strength period on a correction to step up allocations to the AUD. (Without the Shanghai bouncing a risky strategy in my book. The Cad and Nok are alternative lower beta options but on a Shanghai bounce or on news of Chinese stimulus go AUD, in my view).
Without further delay, here the report:
Rich
p.s. WF quick comment & chart focus on US personal incomes. Consumer’s stepped up their spending a little again in Aug as their savings rate declined once again below the 4% mark. For speculators good news. For the people disastrous stuff but that’s tomorrow problem not today’s.
Report here:
(4 votes, average: 5.00 out of 5)
Loading...