Short-term bounce tip after poll

THE Australian share market may enjoy a short-term bounce on the back of the coalition’s surprise election win, before quickly focusing elsewhere. The initial focus this week will be the Coalition’s re-election before attention turns to ongoing global trade tensions and any Reserve Bank (RBA) signals about the timing of interest rate cuts.

AMP Capital chief economist Shane Oliver expects the share market will quickly move on from the election result.

“With the return of the Coalition with its more probusiness policies and uncertainty now removed around changes … it’s possible we will see a bit of a short-term bounce in the share market,” he said.

Dr Oliver said the Coalition win removed uncertainty on excess franking credits, changes to negative gearing and capital gains tax adversely affecting the property market, and increased industrial relations regulation. Property-related shares, banks and retail shares could be the key beneficiaries.

“Against this though the Australian share market has already performed pretty well over the last few months and is likely to be dominated by issues around global trade, slowing growth, interest rates and the iron ore price and so will quickly move on from the election I suspect.”

Futures trading was pointing to a very modest rise when the Australian share market opens on Monday.

US stocks dipped on Friday amid continuing USChina trade tensions, with the S&P500 index closing 0.6 per cent lower and the Dow Jones Industrial Average down 0.4 per cent.