Investors upbeat about federal election

Investors upbeat about federal election

Sentiment among Australian investors is ticking up overall as the federal election campaign gains momentum, says CMC Markets, but it still fluctuates with each major campaign development.


In a statement, CMC Markets said news about election policies and the shifting popularity of the two major parties is affecting investor sentiment nationwide, but added that overall sentiment is positive, despite a series of peaks and troughs.

“This year’s election is the first double dissolution election since 1987, meaning policy intentions are more important than usual,” said CMC Markets chief market strategist Michael McCarthy.

CMC Markets is tracking the effects of the election on sentiment with a new index, the Election Sentiment Index (ESI), which was launched on 10 June.

The index uses international benchmarks to strip out the influence of commodity prices, market size and global sentiment to give an indicator of the influence of election news.

Bank reform policy and a narrowing gap in popularity between the two major parties has so far weighed negatively on stock, the statement said, but noted that a lack of political news between the 3 June and 7 June had curiously had a positive effect.

“The ESI responded to a period of little campaign news flow last week with a gain, confirming that as far as markets are concerned, no political news is good news,” the statement said.

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Investors upbeat about federal election
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