The market has close down this week with Gold leading the way.
There is a lot of speculation over the gold price and what this means for the market. I will put a pin in gold for now and continue to watch. I am not a fan of speculation.
This week China’s GDP came in below expectations, which made investors wary of the material sector with both BHP and RIO losing ground this week.
Both these companies are looking like good long-term buys but I would dollar cost average, as the market appears to be pulling back.
I expect further weakness in the coming months, sure there are still good buying opportunities in the market but as a whole the top 20 look to be over/fully priced.
Funds are still flowing from cash into the market as investor chase yield which is assisting in a slow rate of decline for the market.
We have seen bonds rate decline indicating that once again money is moving into the security of the bond sector, couple this with the run on gold and one needs to be cautious.
We are now looking just outside of the top twenty companies for value still focused on yield and now also looking for some growth as well.