Summary of key points

  • There has been little real change in financial market
    conditions over the last month.
  • It is still appropriate to hold a neutral or benchmark
    allocation to Australian and International equities and
    an underweight to Property and Fixed Interest.
  • Risk factors to be aware of include:
    – Any deadlock that emerges between the US Congress
    and the President in the implementation of the tax cuts
    that have been factored into US equity prices.

– Any economic policy stumble by the Chinese
leadership in the run to the 19th Party Congress
later this year such as choking off credit and
lending to loss making state enterprises too quickly.
– Any capital raising problems of “globally systemically
important financial institutions” in Europe, including
the biggest banks in Italy and Germany (although
the risk of this seems to be receding).


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