Market continues hike to new all-time high

CORPORATE reporting season is under way in Australia and the news is good for many Australian companies who reported this week.

I believe that the outlook for Aussie stocks is likely to remain largely positive in the medium term as the market continues its climb to a new all-time high in 2019.

As with every season there are winners and losers.

Genworth Mortgage Insurance Australia Limited (ASX: GMA) rose by around 7.5 per cent; Credit Corp Group Limited (ASX: CCP) is up by about 19 per cent; and ALS Limited (ASX: ALQ) added around 12.5 per cent to its value this week.

All three stocks had fallen heavily in the months prior and; the rise aided a recovery and increases the probability of further gains this year. GMA and CCP are ranked in the top 200 stocks by market capitalisation, whereas ALQ is a bigger company and ranked in the top 100.

But widely-held miner Rio Tinto Limited (ASX: RIO) has headed swiftly in the opposite direction. Its stock price fell by around 6 per cent this week, down to $76.55.

The drop in crude oil below US$70 per barrel and increasing tensions between the US and China are said to be the cause. But more simply, the chart indicates that RIO was likely to pull back in the current quarter, as it traded towards an important level of resistance at around $90.

For those who are patient, RIO will provide another trading opportunity later in the year.

The All Ordinaries Index has pulled back from the high last week of 6394 points to around 6330 points this week. The fall followed a rapid acceleration on our market in May and June, which couldn’t be sustained indefinitely.

So this recent rise indicates the market has been up for more weeks than it is likely to fall into the next low, and is therefore still bullish. Dale Gillham is chief analyst at Wealth Within