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An overview of the telstra shares in australian stock exchange in economics

Prices and research

View all announcements But just in case you thought this was just about the big bank, mining and energy names, here's another stat for you to chew over: Macquarie is the poster child here, as the investment-bank-turned-asset-manager's share price reached all-time peaks. Peter Rae A weaker Aussie always helps offshore earners — such as Macquarie or the likes of blood plasma giant CSL — but it tends to work against the broader market as foreign investors take a dim view of putting more money in any asset denominated in a falling currency.

As I wrote this week, this may be because the sharp falls in emerging markets assets and currencies have boosted the attractiveness of high-yielding and relatively stable Australiadespite a marginally weaker Aussie.

  1. The stock dropped sharply on the day, by around 5 per cent. Or any or all of these things spark a house price crash that drags us into our first recession in over 25 years.
  2. Fast forward So what now — can the ASX's impressive rally keep going? The stock dropped sharply on the day, by around 5 per cent.
  3. They trade at price-to-book ratios approaching 1. Commodity prices are holding up and the big miners are minting it with iron ore and coal at these levels.

Also, whereas a firmer greenback would usually weigh on commodity prices, surging oil prices this year have been driven by supply issues. Meanwhile, there are whispers of China implementing more stimulus measures, and rates look set to stay low and accommodative in Australia for quite some time.

Key statistics

Back on the ASX, and only five names are trading at 12-month lows, headlined by a name we all know: The big telco's shares had been pushing higher over a number of sessions heading into Wednesday's much anticipated strategy day. Boss Andy Penn gave the market the story it was expecting and wanted to hear: The problem was Wednesday's story came with a sting in the tail: The stock dropped sharply on the day, by around 5 per cent.

Tellingly, the shares have continued to fall since. But that was the bad news. The good news is that the recent extended rally has helped save a broad Aussie equity market investor's financial year performance.

Shares now look like returning close to 10 per cent in price terms if we don't get a collapse between now and June 30.

Add in dividends, and we are looking at closer to 15 per cent. Fast forward So what now — can the ASX's impressive rally keep going? Maybe not at the same pace, but the signs are reasonably positive. Let's go through the trends that have put us here. They look reasonable value.

Australian Stock Exchange (ASX)

They trade at price-to-book ratios approaching 1. Yields are pushing 10 per cent or beyond after grossing up for franking. Nonetheless, recent weeks look like what could be uncharitably called a "dead cat's bounce". There are probably still too many structural headwinds, too many distractions, too much political pressure for the major lenders to move too much higher from here over the next nine to 12 months. The margins are being squeezed by this year's spike in short-term funding costs.

Forget Telstra: the ASX is going off

They would love to raise rates to offset this pressure — but can they? It would spark howls of outrage, but might just send a more positive to investors that the lenders still have some measure of pricing power.

A better story can be told around the resources sector. Commodity prices are holding up and the big miners are minting it with iron ore and coal at these levels. Professional investors seem upbeat and expect there to be further earnings upgrades ahead.

Telstra Corporation Ltd

Oil prices look likely to remain elevated through the year — although a word from OPEC could turn the story on its head. Recent policy changes in China look to have underpinned greater demand for LNG.

Things that can go wrong: Or any or all of these things spark a house price crash that drags us into our first recession in over 25 years. More likely, though, is the recent market momentum will wane and ease off into the new financial year, before the ASX, hopefully, finds its next leg higher.