{"id":3087,"date":"2016-07-04T06:10:43","date_gmt":"2016-07-04T06:10:43","guid":{"rendered":"https:\/\/raizinvest.com.au\/investors\/undecided-election-leads-to-an-undecided-market\/"},"modified":"2024-04-04T19:22:18","modified_gmt":"2024-04-04T19:22:18","slug":"undecided-election-leads-to-an-undecided-market","status":"publish","type":"post","link":"https:\/\/raizinvest.com.au\/investors\/blog\/undecided-election-leads-to-an-undecided-market\/","title":{"rendered":"Undecided election leads to an\u00a0undecided\u00a0market"},"content":{"rendered":"
\"image\"<\/figure>\n

The
\nfocus of the Australian market is on the result \u2013 or rather lack of result \u2013
\nfrom the weekend\u2019s federal election. It appears the most likely outcome is a
\nhung parliament although we may have to wait some time until we know for
\ncertain. Unfortunately, the Australian Electoral Commission has made it clear
\nthat it won\u2019t begin counting any more votes until Tuesday, leaving buyers and
\nsellers in an information vacuum.<\/p>\n

\u201cSuch
\nuncertainty is never good for markets\u2026. However, the Australian economy remains
\nstrong.\u201d<\/i><\/p>\n

As
\nthe possibility of a hung parliament looms closer, the financial market grows
\nmore and more uncertain. Additionally, the prospect of the second hung
\nparliament within three years escalated speculation the governments AAA-credit
\nrating will come under pressure in the coming weeks.<\/p>\n

Such
\nuncertainty is never good for markets, and traders may have to wait a month or
\neven longer to start to get a picture on who will be forming a government for
\nthe next three years. However, the Australian economy remains strong. We do
\nexpect international money flows into our market will slow until the election
\noutcome is known.<\/p>\n

\u201cIf
\nBrexit taught investors anything, at times of such economic uncertainty it is
\nimportant to remember the golden rule; do not panic!\u201d\u00a0<\/i><\/p>\n

Australian
\nChamber of Commerce and Industry boss James Pearson believes it\u2019s very likely
\nthat whoever does form government will now have to build strong relationships
\nwith crossbenchers \u201cto get things done.\u201d Sometimes a minority government can
\nimplement a higher level of discipline and ultimately work better.<\/p>\n

If
\nBrexit taught investors anything, at times of such economic uncertainty it is
\nimportant to remember the golden rule; do not panic! Much to the surprise of
\nmarket participants, equities and bonds have recovered most of the losses they
\nexperienced in the wake of the Brexit vote.<\/p>\n

Additionally,
\nThe Reserve Bank is observing all of this unfold, potentially intervening with
\nan interest rate cut on Tuesday, although economists think this is unlikely. We
\nare also expecting a 0.5% month on month rise in retail sales reflecting a
\nsustained rebound in consumer confidence following the RBA\u2019s decision to cut
\ninterest rates in May.<\/p>\n

 <\/p>\n

Important Information<\/strong><\/span><\/p>\n

The information on this website is general advice only. This means it does not consider any person\u2019s investment objectives, financial situation or investment needs. If you are an investor, you should consult your licensed adviser before acting on any information contained in this article to fully understand the benefits and risk associated with the Raiz product.<\/p>\n

The information in this website is confidential. It must not be reproduced, distributed or disclosed to any other person. The information is based on assumptions or market conditions which change without notice. This will impact the accuracy of the information.<\/p>\n

Under no circumstances is the information to be used by, or presented to, a person for the purposes of deciding about investing in Raiz.<\/p>\n

Past return performance of the Raiz product should not be relied on for deciding to invest in Raiz and is not a good predictor of future performance.<\/p>\n","protected":false},"excerpt":{"rendered":"

The focus of the Australian market is on the result \u2013 or rather lack of result \u2013 from the weekend\u2019s federal election. It appears the most likely outcome is a hung parliament although we may have to wait some time until we know for certain. Unfortunately, the Australian Electoral Commission has made it clear that […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false},"categories":[1],"tags":[],"yst_prominent_words":[]}