02 Oct Shares around record highs as inflation slides, central banks cut rates and China stimulates
Key Points
- Recession risks, the escalating Israel conflict, the US election along with still stretched valuations mean a high risk of another share market correction and continued volatility.
- The expansion of the war around Israel and Iran attacking Israel with more missiles is very concerning but unless oil supplies are disrupted the impact on global growth and shares will remain limited.
- However, the combination of global rate cuts, still okay global economic growth and Chinese stimulus are very positive for shares on a six-to-12-month horizon.
- While the RBA remains relatively hawkish, the resumption of falling underlying inflation since May tells us that the start of rate cuts here is getting closer.
