The Swiss team sticking to their pro material and cyclical bullish theme again. They observe the strong rally in defensive and admit being surprised by the relative strength. On the break of 1430 they explore possible alternative scenarios and interestingly the possibility of an early q4 correction in markets. They maintain that this is a lower probability though of course possible. For now they stick to buying dips on AUD, Shanghai, material stocks etc.
I concur with their view having, if you remember, not let my defensive’s go previously. The strength in the yielding defensive sector comes as no surprise to me given the negative yield environment we live in. I’m not so sure i would describe the Shanghai as “strong” but she does appear to be basing and therefore the materials offer upside potential. Id like to see the underlyings like copper break their bear trends to be happier. We look out for this event.
Here the report.
Rich
(8 votes, average: 5.00 out of 5)
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