Caton’s Corner July 2013
Share market volatility continued in June. At the close on 20 June, the Australian market had fallen by 3.4% from its 31 May level while the US market was down by 2.6%. This brings the year-to gains to 2.4% and 11.4% respectively. At the current low point for this correction, during the day on 13 June, the Australian market was down by more than 10% from its 14 May close of 5221. That low point may, however, be challenged on 21 June.
There is no doubt what the major international force driving markets is: the continued concern that the Federal Reserve may end its programme of quantitative easing (QE). QE expands the Fed's balance sheet, and the chart above shows the apparent effect this has had on the US share market in recent years.
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