The common macro theme is that this downturn may have two waves. Firstly the valuation downgrades due to rising inflation which forced rising interest rates and secondly downgrades due to economic slowdown / recession that hit profits / earning. The waves can muddle but if MQG has only dropped due to the first wave (before recovering) it could still drop again.
Oil is an issue that I think is being overblown at the nett global level because Russian supply is being picked up by Russian aligned countries (at a lower rate) and these countries don't need to buy from 'free world' market supplies.
The outcome of the Russia-Ukraine-Europe is still unknown. China economic slowdown is also a risk but thing may have settled geopolitically for now provided neither China nor the west push too hard.
Bearishness is at very high levels which means more cash is being built so the recovery could be fast if investor confidence returns but with all that has to be worked through I am expecting a flat / sideways market for longer i.e. more like 12-18 months than 3-6 months.
MQG Price at posting:
$167.63 Sentiment: None Disclosure: Held
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