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Election uncertainty halts company decisions
The uncertainty surrounding the outcome of the Federal Election had created a definite pause in major company decision-making, according to Colonial First State senior portfolio manager for Australian equities, Matthew Reynolds.
Addressing an Australian Institute of Superannuation Trustees (AIST) conference on the Gold Coast, Reynolds said there had been a perceptible pause in decision-making during the election and he expected that the pause would continue until things became clearer.
He said that companies were exhibiting caution in the absence of any immediate transparency over the direction of the Government on policy implementation and how it intended to get there.
However Reynolds said that the ability of the Australian Labor Party to form a minority Government had represented a positive for both the National Broadband Network and the future of Telstra.
He said that notwithstanding the caution around the election result, the valuation of the Australian market remained very attractive with dividends strong albeit that earning expectations were a little high.
AUTHOR
Mike Taylor
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