Market Trends Continue Higher

Market Trends Continue Higher

Investors with active positions in the financial markets have had a tremendous year in 2015.  Market demand is rising and this has helped retail sales numbers in most sections of the global economy.  Stock markets are rising and commodities producers have seen large increases in the number of orders posted for their products.  This is significant for the Australian economy because there are so many commodities outlets that are used as a pillar for several industries.  One of the best examples here is the production of copper, which is widely used in many emerging economies that are still industrializing (ie. China and India).

For this reason, investors should remain aware of the trends that unfold in these areas as it will be a great indication of whether or not market will be able to continue higher.  As a precursor to this, we will likely need to see some additional increases in annual GDP figures as this will make it easier for companies to post increases in quarterly corporate profits.  When quarterly profits increase, stock markets tend to rise and the ultimate reality of the financial markets is that a rising tide does lift all boats.  So this would largely suggests that other areas like commodities would then benefits, as well.

Industry Trends in Commodities

Of course, those looking to invest in Australian stocks will need to also watch for activity in the commodities space as there are many major commodities companies that are centered in Australia.  It will be important for investors to remain aware of commodities prices because higher prices will be another factor that can support the earnings outlook for Australian companies.

Recent industry reports from Mocaz show that commodities prices have stabilized versus a number of different world currencies.  This is important because it means that assets like oil and building metals will likely see rising demand in the weeks and months ahead.  So while this will directly impact trends that are seen in commodities it is also indicative of the fact that the market as a whole is still improving.  All of these elements are things that will continue to be important for monitor going forward as these are the elements that will be most important for the market trends seen in Australian companies going forward.

The Australian economy is still heavily centered on the commodities space so while the overall outlook remains bullish there is still a good amount of reason to remain cautious when putting real money positions into the market.

 

Tagged Commodities