The Sun Will Shine On Investors This Financial Year
Let me go out on a limb (and I haven’t done this since climbing trees as a kid – but that’s another story!). I believe the sharemarket will recover this year.
In brief, Australia’s economy is performing very well with company profits at record levels. The high $A is making it more expensive for overseas investors than in the past. If the exchange rate moves back towards its long term average of 80c US – not $1.03 US, as it is now, it will make investment in Australia and the purchase of our goods cheaper for those overseas. The sharemarket is low but dividends from ‘blue chip ‘ shares are now often more than the interest rate you can get on Term Deposits.
It’s for these reasons that I believe the sun will shine on investors over the next year.
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