Originally Posted by
modandm
Nothing to do with the cycle, just plain fear in markets at present. There is a lot of hype around ebola in the US press, but really its just that the market (in the US), got a little expensive after a great run, and we are seeing investors bailing out. As usual its a disorderly exit, with hedge funds etc amplifying volumes, and lemmings/sheep capitulating. The NZ market is not a bad place to hide given our low volumes. AIR is trading down as you would expect, but I wouldn't panic. Outside the currency move I haven't seen anything fundamental to change the outlook, its pure risk-off and short term sentiment driving the move lower.
The US economy will grow slowly, while QE is becoming increasingly likely in Europe as data deteriorates. The UK is healthy. EM is a mixed bag, slower than historic growth, but still decent. Australia is slow but ok, NZ is still humming.
What people forget when the look at dairy prices alone is volume. Last year prices were high because of a drought and low volumes. This year prices are low and volumes are high, no it doens't fully offset, but its not as bad as some suggest. Meanwhile immigration, christchurch, property, and the service economy (most of the economy), is doing fine. Lower oil prices will support the global consumer and the recovery.