Market did not find support.
The news flow into the market has been very active over the past couple of weeks but this has not flowed through into a healthier market. As you can see from the below chart the market has fallen further over the past week. It failed to find support around the 4400 level and is now currently trading close to 4200.
This could see the market continue to fall below 4000 in the coming months. The new Mining Resources Rent Tax was supposed to resolve the issues for investors and see money start flowing back into the market. BHP and RIO had small gains but nothing to write home about, at best these stocks have been flat after the announcement.
My view is that recent events in our government has once again provided uncertainty for investors. The Labor party is changing its mind as quickly as the opinion polls change.
For now, I for one will be weary of the market and this government. I think it is time for the people to elect a new Prime Minster and the announcement of the election date will be most welcome. I expect that the market and investors will be sitting on the side lines until some certainty about who will govern Australia is achieved.