Australian Equities - Investment update
Andrew Fleming analyses the impact of Brexit on the Australian Equity Market, its sectors and our portfolios.
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Brexit has highlighted the dramatic impact upon markets that can be caused when plausible, but lower probability scenarios, actually occur. The Australian equity market is positioned as never before for a continuation of the themes from the past several years – low growth, even lower interest rates, and an aggressive acceptance of financial leverage and abhorrence of operating leverage. What if this scenario does not play out? What if a new paradigm of low growth but stimulus through measures other than just monetary policy, as spoken to this year by Larry Summers, Ben Bernanke and Alan Greenspan, as well as Glenn Stevens in Australia, is formalised? What is the likely impact upon the Australian equity market; which sectors will win and which will lose?
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