The dogs of the Australian sharemarket are licking their wounds, with investors in no mood to take a punt on turnaround stories or bargain buys while the sell-off is in full swing.
Their selling is widespread: growth and value, blue chip and small cap, defensive and cyclical. There is no one clear pattern; it is anything that put up a soft result in August, wherever there are fears about capital allocation or management, or that has even a hint of a bond proxy.
When things do stabilise – by things, we mean bond yields, interest rates and the economic outlook – the rebound could be sharp. Fund managers are mostly sitting on large cash balances, and watching for smoke signals every night out of the United States. All this selling and the new, 12-month and all-time lows being recorded promise an interesting round of annual general meetings in the coming six weeks.